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Last Updated: Monday, 29 January 2007, 07:35 GMT
Alitalia warns of widening losses
Alitalia plane
Alitalia has not made a profit since 2002
Troubled Alitalia has warned full-year losses will be wider than expected - just hours before a deadline for expressions of interest in the airline.

The group said losses would come in at 380m euros ($490.3m; 250.3m), against previous estimates of 221m euros.

The state-owned carrier added that losses for the year to November stood at 197m euros.

The Italian government wants to sell a stake of at least 30.1% in the firm after failing to revive the business.

Prospective buyers have until later on Monday to table an offer.

Among those believed to be eyeing the group are US buyout firm Texas Pacific, while reports suggest rival Italian airline Air One could make an offer.

Financial woes

Alitalia is required to update the market about its finances on a monthly basis as market regulators have put it on a "blacklist" of financially weak firms.

The airline blamed a range of factors - including strikes, tough competition and high fuel prices - for its losses.

However, despite warning it will head deeper into the red, the group said it had enough money to remain in business for "well beyond 12 months".

In a separate announcement, Alitalia said monthly passenger traffic had fallen 2.3% in December.

Alitalia, which has suffered from frequent strikes and over-staffing, has not made an annual profit since 2002.

The government is seeking to dilute its existing stake in the struggling carrier from 49% to 19%, and has not ruled out selling all of its shares.

If 30% or more of the government's stake is sold to a single bidder, the purchaser would be obliged to make a full bid for the company.




SEE ALSO
Air France boss leaves Alitalia
17 Jan 07 |  Business
January deadline for Alitalia bid
29 Dec 06 |  Business
Italy to reduce stake in Alitalia
01 Dec 06 |  Business
Leaders discuss Alitalia future
23 Nov 06 |  Business
Fresh losses at troubled Alitalia
13 Nov 06 |  Business

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