Etihad, partners' bonds drop again as Air Berlin bankruptcy sparks bailout concerns

Etihad, partners' bonds drop again as Air Berlin bankruptcy sparks bailout concerns:

"Etihad Airways' bonds issued through a special purpose vehicle have dropped more than five points in the secondary market a day after Air Berlin, in which Etihad has a large minority stake, filed for bankruptcy protection.

In April, the "EA Partners" bonds dropped by almost 10 cents on the dollar after workers at the Italian carrier Alitalia [CAITLA.UL] – in which Etihad has a 49 percent stake – rejected the company's latest turnaround plan, blocking it from accessing rescue financing.

An "internal debt assumption" agreement between Etihad and Alitalia – revealed through a Fitch note in the days following Alitalia entering special administration, but had been signed earlier – put a floor under the bonds, and they subsequently bounced back almost to par value."



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