Alitalia update

Italy's Alitalia struggles on with Poste Italiane and bank Unicredit joining just before the holidays with a €300m capital increase.  The cash from the investment will be used to keep the troubled airline in the air while it searches for a new partner willing to give strong support.

Etihad Airways is also considering a possible move, the airline expansion-minded with holdings in Aer Lingus (2.987%), Air Berlin (29.21%), Air Serbia (49%), Air Seychelles (40%), Darwin Airline (33.3%), Jet Airways (24%) and Virgin Australia (19.9%).

"Etihad Airways is in discussions with Alitalia.  We have no further comment at this time," an Etihad spokesman said in a statement.

Etihad is known to have been looking at Alitalia's books and could consider investing in the airline which offers access to Europe's fourth-largest travel market and flies 25m passengers a year.

Alitalia is said to lose €700,000 a day and has net debt of more than €800m.

Air France-KLM, once the airline's largest shareholder with a 25% stake, let its holding dilute to around 7% and refused a recent capital increase. www.alitalia.com

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