Outgoing Italian Premier Romano Prodi said on Thursday that he hoped Air France-KLM's interest in Alitalia could be revived after the French carrier ditched its bid to buy the struggling Italian airline in reaction to union job-saving demands.
''I hope common sense prevails and that negotiations can be resumed,'' Prodi told reporters on the sidelines of a NATO summit here.
He declined to confirm reports that Cabinet Undersecretary Enrico Letta had been assigned a 48-hour mission to try and get the talks back on course.
A statement from the premier's office said the government was only seeking to establish whether negotiations between Air France-KLM and Alitalia unions had broken down ''definitively''.
Alitalia moved closer to bankruptcy on Wednesday when Air France-KLM walked away from takeover talks because of what it said were unacceptable new demands by Alitalia unions aimed at containing job losses.
This was followed by the resignation of Alitalia CEO Maurizio Prato, who took over the carrier's helm last August with the aim of piloting the sale of the 49.9% controlling stake in the airline held by the Italian Treasury.
Prato, Alitalia's fourth chairman in three years, was called in after an attempt to auction the Treasury's stake failed last summer.
The Treasury gave Prato a mandate to pick an exclusive talking partner for direct and exclusive negotiations.
In December, Alitalia chose Air France-KLM, the second biggest shareholder in the Italian carrier after the Treasury, from a short list of possible buyers which had presented framework proposals.
Air France-KLM presented its binding offer last month and although it won the approval of the government and the Alitalia board, unions rejected it because of the proposed 2,100 layoffs and the downsizing of the airline's activities.
Air France-KLM Chairman Jean Cyril Spinetta began direct negotiations with Alitalia unions last month but on Wednesday he threw in the towel after the unions presented a counterproposal which he defined as ''unacceptable''.
Prato also decided to call it quits, telling reporters that the carrier was ''cursed'' and that what it needed most was ''an exorcist''.
The government, meanwhile, pledged to keep the airline going despite a looming cash crunch.
If Alitalia is placed in receivership, it could qualify for state aid under the so-called Marzano Law, which allows bankrupt major industrial companies to restructure.
Alitalia has some 1.5 billion euros in debt and continues to lose around one million euros a day, while cash-on-hand can only guarantee operation for a few more months.
Trading of Alitalia shares was suspended on Thursday, while the executive board held an emergency meeting to discuss the carrier's fate.
Alitalia was expected to issue a statement after markets close.
Air France-KLM shares, meanwhile, jumped 2.43% to 19.35 euros.
