The new company resulting from the tie-up between Alitalia SpA and Etihad Airways will be chaired by former Ferrari chief Luca Cordero di Montezemolo with Etihad chief executive James Hogan as his deputy, two people privy with the matter told Reuters. The new company is an offshoot of a transaction in which Etihad agreed to acquire 49 percent of Alitalia as part of a EUR1.76 billion ($2.2 billion) rescue package.
The sources remarked there has yet a formal appointment for Montezemolo and Hogan since the deal has yet to be officially approved by the European Commission. Montezemolo left Ferrari in October after disagreements with Fiat Chrysler CEO Sergio Marchionne.
Montezemolo wanted to keep Ferrari autonomous from Fiat Chrysler, while Marchionne was aiming to integrate the sports carmaker into the group to boost its shift to the premium market. Montezemolo, who had been Ferrari chairman since 1991, agreed to a severance package worth around EUR27 million. Marchionne recently disclosed a plan to spin off 10 percent of Ferrari's shares through public means.
While Montezemolo’s appointment as Alitalia chairman could go smoothly, the tapping of Hogan as his deputy may hit a snag from the European Commission which requires that no airline from outside Europe controls a European carrier.
Montezemolo, being one of Italy's best connected and most colorful business leaders, is considered as big boost to Hogan's bid to revitalize Alitalia, which he once called as the "sexiest airline in Europe."
Andrea Giuricin, a transport analyst at Milan's Bicocca university, said Montezemolo as chairman as Alitalia will “help build a strong brand image." The European Commission targets to decide by Nov. 17 whether to approve the Alitalia-Etihad deal.