This will be a crucial weekend for the future of Alitalia as efforts continue to jump start takeover negotiations with Air France-KLM before a decisive board meeting next Tuesday.
Air France-KLM broke off talks with Alitalia this week after unions presented a counter proposal to its takeover plan with what the French-Dutch carrier considered ''excessive demands''.
The breakdown in talks was followed by the resignation of Alitalia CEO Maurizio Prato, who had helped broker the deal with Air France-KLM .
The offer has already been approved by the Alitalia board and the Treasury, which is selling its controlling 49.9% stake in the airline.
Prato, who took over the helm last summer, was replaced Thursday night by university professor Aristide Police, an expert in corporate law, but he was not given the executive powers which his successor enjoyed.
Police, Alitalia's fifth chairman in some three years, is now expected to try and convince unions to backtrack and accept the Air France-KLM plan before Tuesday.
If no solution is found, the Alitalia board on Tuesday is expected to ask that the company be placed in receivership, which could pave the way for the national carrier's demise.
However, should the Air France-KLM plan be accepted, then Alitalia would be in a position to seek credit on the market to keep operating until the merger is completed and Air France-KLM takes over responsibility for its finances.
Alitalia, which has debts of some 1.5 billion and continues to lose about one million euros a day, has sufficient funds to keep operating for only a few more months.
Trading of Alitalia shares and convertible bonds have been suspended on the Milan stock exchange until after Tuesday's board meeting.
Alitalia top brass met with unions on Friday and they were reported to have re-examined Prato's original rescue plan, which had been incorporated in the one presented by Air France-KLM and included the much-contested layoffs of 2,100 employees.
Union sources said they reviewed ''options to keep the company operating and avoid receivership''.
The same sources added that ''we are evaluating a stand alone plan to see if it is feasible or needs adjustment''.
In an appearance before parliament last September, Prato said Alitalia could only survive by being taken over by another airline.
''It surprises me how just about everyone refuses the reality of the situation. A company in this condition... cannot stand alone''.
''In theory there could be an umpteenth attempt to try and relaunch the airline. But this would only be an illusion. There is no way this airline could ever compete against the leading European carriers,'' he added.
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.
However, while this law was successful for companies like Parmalat and Cirio, which produced earnings but were straddled with massive debts, Alitalia's problems are both financial and structural.
Added to this, the nature of the air transport sector will make it very difficult for Alitalia to restructure and become competitive.
If restructuring is not possible, Alitalia would be declared bankrupt and its assets, including planes, routes and slots, sold to help pay off the airline's debts.
These could be bought by other airlines, like Air France-KLM or Italy's biggest private carrier Air One, or used to create a new, private airline.
This airline would thus have acquired what once was Alitalia but without the weight of its existing union contracts, loss-making routes and other activities, as well as the obligation to maintain employment levels, logo and brand.
