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Alitalia board approves 500 million euro rescue package

MILAN (Reuters) - The board of Alitalia has unanimously approved a 500 million euro (425 million pounds) rescue package for the loss-making Italian airline, including a capital increase of 300 million euros and the remainder in bank financing, the group said on Friday.

The company said the capital increase will be offered to existing shareholders, while the state-owned postal service has guaranteed to subscribe up to 75 million euros possibly not subscribed in the cash call.

Banks Intesa Sanpaolo (MIL:ISP) and Unicredit (MIL:UCG) will similarly guarantee the subscription of up to 100 million euros of unsubscribed options.

In addition, Intesa and Unicredit have agreed to provide a bridge to equity facility of 100 million euros to allow Alitalia to meet its immediate cash needs.

(Reporting by Agnieszka Flak)