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Last Updated: Monday, 17 December 2007, 15:59 GMT
Alitalia rivals outline bid plans
Alitalia plane
Alitalia's most attractive feature is its Rome to Milan route
Air France-KLM has said that it has offered to buy troubled Italian airline Alitalia through a share swap.

The firm is one of three remaining bidders for the airline, which is 49.9%-owned by the Italian government.

Rival suitor Air One has bid one euro cent per share for Alitalia, which it would keep as a listed company.

A decision on which bidder will buy the airline is due on Tuesday. The third interested party is a consortium led by Italian lawyer Antonio Baldassarre.

Italian Transport Minister Alessandro Bianchi said both the Air France-KLM and Air One plans had merits.

No job losses

Air France-KLM has not said how many shares will be swapped, but it has promised to inject 750m euros ($1.08bn; 535m) into the airline.

It has also said that there will not be any additional redundancies added to Alitalia's current restructuring plan.

The capital injection will be paid for by issuing new shares.

The share swap scheme means that the Italian government would be able to retain a stake in the new company.

New aircraft

Meanwhile AP Holdings, which controls Air One, said it was ready to offer stakes to one or more international players as part of the Alitalia deal.

It said the offer of one euro per share would "allow the resources invested to be entirely used to relaunch" Alitalia.

Air One has also told Italian media that it plans to buy 130 Airbus aircraft to renew the Alitalia fleet, and that it would pump in 1bn euros.

Alitalia is burdened with 1.2bn euros in debt and is losing more than 1m euros a day.

The Italian government has set a Christmas deadline for choosing a buyer.

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13 Dec 07 |  Business
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19 Jul 07 |  Business

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