Alitalia began talks on Tuesday with Air France-KLM to sell the Italian Treasury's controlling stake in the troubled Italian national carrier.
The Italian government said the talks would last eight weeks.
Economy Minister Tommaso Padoa-Schioppa told parliament that Air France's business plan offered the best prospects for the debt-laden airline and would allow the government to maintain a ''far from negligible'' stake in Alitalia.
He said the Franco-Dutch airline had ''excellent experience with mergers'' and offered ''excellent solutions'' to the exodus from Italy of intercontinental traffic in favour of other European hubs.
The lay-offs envisaged in the merger plan were ''substantially in line'' with Alitalia's own survival plan, drafted last year, he said.
Alitalia stock fell 2.51% on the Milan bourse while Air France-KLM closed 3.60% down in Paris.
Air France-KLM intends to make an offer for 100% of Alitalia through a share-swap arrangement.
Alitalia CEO Maurizio Prato recently said the company was ''on its last legs''.
The Alitalia board chose the Air France-KLM bid over a rival offer presented by AP Holding, the parent company of Italy's biggest private carrier Air One.
The choice of Air France-KLM has been applauded by Alitalia pilot and flight staff unions but criticised by ground staff unions.
The choice has also been contested by the devolutionist Northern League, the Milan city and provincial governments as well as that of the region of Lombardy.
This is because of Air France-KLM's intention of downsizing Milan's Malpensa airport from hub status in favor of Rome's Fiumicino airport.
According to Prato, Alitalia cannot maintain two hubs.
Air France-KLM had been a front runner from the start thanks to its size as well as the fact that it already owns a 2% stake in Alitalia and is its partner in the SkyTeam alliance.
The government decided at the end of last year to sell most if not all of the Treasury's 49.9% stake in Alitalia.
An attempt to auction the stake failed this summer after all the bidders dropped out because of the conditions imposed by the Treasury.
It was then decided that Alitalia management would negotiate the direct sale of the Treasury's stake.
