Air France boss leaves Alitalia

Jean-Cyril Spinetta, the head of European airline Air France-KLM has resigned from the board of Alitalia, setting off speculation that the airline may be preparing to bid for the Italian airline, which is up for sale.

Air France-KLM currently owns a 2-per cent stake in Alitalia, which has not made a profit since 2002 due to labour unrest and overstaffing. Alitalis has also been losing market share to low-cost rivals.

Among European aviation firms, Air France-KLM is regarded a serious potential acquirer for the Italian flag carrier despite its caveat that it would consider an acquisition only if there was a turnaround in Alitalia's finances.

The Italian government, which owns a 49.0-per cent stake in the airline, has initiated a bidding process for Alitalia to sell 30.1-per cent shares that could make it imperative for the buyer to launch a full acquisition offer.

The Italian government's 29 January deadline to find a buyer for Alitalia, is loaded with pre conditions that say bidders must safeguard the airline's national identity, that the main routes should be maintained and restrictions on job cuts.

Other bidders said to be considering a possible move for Alitalia are Italian private equity firm Management & Capitali, and investment bank Rothschild.