Indigo Partners, the US private equity fund that invests in some of Europe’s leading ultra low cost airlines such as Wizz Air and the American continent, sent an expression of interest for Ita Airways in the second half of February. what they confirm to Corriere della Sera government sources aware of the dossier. his is the second proposal considered interesting by the technicians of the Ministry of Economy (sole shareholder of Ita) in addition to that of MSC and Lufthansa. While the letter sent by another US fund, Certares, does not yet meet all the requirements of the privatization decree of the tricolor carrier.
The letter
The economic details of Indigo Partners’ expression of interest are not known. You know – as the Courier service a few days ago, without mentioning it directly – that its proposal is considered extremely serious and detailed, above all because the leaders of the US fund write down what they intend to do with Ita Airways should they win the challenge and how they plan to evaluate the company. In an e-mail on Thursday 10 March, an Indigo spokesperson responded with a no comment to the questions of the Courier service. No comments from Ita Airways either. But American sources confirm the contacts.
The development draft
From what we learn Indigo mainly focuses on short and medium connections – which for Italy would mean national, European and at most North African and Middle Eastern -, but does not exclude, in perspective, using the ultra low cost Wizz Air (of which it holds 7.16%, second shareholder) as a power source for Ita Airways’ intercontinental flights to the USA, Canada and Latin America by carrying passengers beyond the major hubs with the other airlines that it directly controls or of which a shareholder: Lynx Air in Canada, Frontier and Spirit in the United States, Volaris in Mexico, JetSmart in Brazil and Chile. Of course, experts believe it is a complicated system to set up by integrating a traditional carrier with low cost. Because of this it cannot be ruled out that this is an attempt to access Ita’s confidential data and then exploit them to the advantage of Wizz Air which invests a lot in Italy.
The MSC-Lufthansa proposal
On the other side there is MSC-Lufthansa’s expression of interest which, in addition to a development plan on intercontinental routes, on charter and cargo transport, puts on the plate among the 1.2 and 1.4 billion euros to take over 75-80% of Ita Airways, with the remainder to be left to the Italian State which will later leave the company. This is a proposal considered preferable by the Treasury technicians called to study the letters in the context of the privatization of the Italian airline because according to them it would offer a medium-long term perspective, would provide sufficient employment and development guarantees and would guarantee a good rate of intercontinental connectivity.
A challenge for two
Except surprises they should be right Msc-Lufthansa and Indigo Partners to access the Ita data room. It remains to be seen whether the Certares fund – which came forward by proposing a possible commercial partnership between Air France-KLM and Delta Air Lines – will send a new expression of interest, more structured and above all more solid both from an economic and industrial point of view. . Only the proposed entry into the equity of Ita by Air France-KLM and Delta can at this point also lead to a share in the letter from Certares.
The Indigo story
Indigo Partners was created in 2002, is headquartered in Phoenix, Arizona, and among the founders is Bill Franke, 85 in April, veteran of the aviation industry. The fund (not to be confused with the Indian low cost IndiGo) immediately concentrated on the one that was the most driving market segment in those years, the low cost one, introducing an even more cost-conscious version (the ultra low cost) also placing record orders with aircraft manufacturers at the lowest possible price. The latest, in chronological order, dates back to November 14th during the Dubai Air Show: on that occasion Indigo Partners has ordered an additional 255 Airbus A321neo for a total of 1,145 fund requests, all Airbuses, from the start of the adventure, and a list cost of $ 32 billionnet of 50-60% discounts.