The Italian government further extended the deadline for the sale of struggling flagship air carrier Alitalia, even as reports surfaced that Germany‘s Lufthansa offered to pay 500 million euros (600 million U.S. dollars) as part of a plan to take control of the Rome- and Milan-based airline.
A takeover by Lufthansa would make Alitalia part of Europe’s largest airline, but would also reduce Alitalia to a regional carrier that fed into the Lufthansa system via its hub in Frankfurt.
Neither Lufthansa nor Alitalia would comment about the offer, but Italian media reports said that the financial offer came along with plans to take over Alitalia’s landing slots at key European airports while reducing the number of long-haul routes and also slashing short-haul routes where Alitalia faced competition from low-cost carriers.
Around half of Alitalia’s 12,000-strong work force would also be laid off, according to the reports.
But the reports also indicated that the offer was likely to be rejected by the committee of state-appointed officials as too harsh.
The deadline for bids was at the end of business on Monday, but instead of closing the bidding process, the committee members announced the deadline would be extended to April 30, 2018.
It is the second time the deadline for Alitalia bids was extended this year.
To help keep Alitalia afloat, the government also voted to loan the company 300 million euros, half the size of the loan it made in May. The deadline for the repayment of the loan from May was extended from November of this year to September 2018.