EU's Vestager says solution over Alitalia replacement possible

By Foo Yun Chee

BRUSSELS (Reuters) -EU antitrust chief Margrethe Vestager said on Friday that she believed that a solution regarding Italy's plan to set up a new airline to replace cash-strapped Alitalia can be found, stressing that the new carrier should be independent from the old one.

Talks between the European Commission and the Italian government have foundered amid disagreement over its successor ceding half of Alitalia's slots at Milan Linate airport, the old brand and the loyalty programme.

"I continue to believe we can find a workable solution. ITA has to be a real company, there has to be discontinuity otherwise ITA would be liable for Alitalia," Vestager told a news conference.

"Investments in ITA must have market conformity, so investments by the Italian state would give a return that would satisfy private investors," she said, adding that she was waiting for a new proposal from Rome.

Vestager also said she was very close to a decision over the 1.3 billion euros ($1.57 billion) in state aid granted to Alitalia since 2017, but did not provide details.

($1 = 0.8281 euros)

(Reporting by Foo Yun Chee; editing by John Stonestreet and Jason Neely)