Air France-KLM denies Alitalia interest

AMSTERDAM, Netherlands, July 24 (UPI) -- Air France-KLM denied a report Tuesday it was still considering ways it could buy Italy's Alitalia SpA after the government failed to sell the sputtering airline.

Dutch newspaper De Telegraaf reported the French-Dutch carrier, which had once expressed an interest in Alitalia, was now interested again, but demanded a clear plan for privatizing and financially restructuring Alitalia, which is losing nearly $3 million a day.

Alitalia stock rose as high as $1.15 a share on the news before the Air France-KLM denial. It closed at $1.09 a share, up 4 cents or 4.39 percent.

Rome scrapped its auction of the flagship carrier Wednesday after the U.S. fund Matlin Patterson Global Advisers LLC, the last interested party, dropped out.

Italian airline Air One, a favored bidder, also abandoned the auction process.

Analysts say Premier Romano Prodi's government now faces few options for the money-losing carrier.

Air France-KLM, which did not take part in the auction, is an Alitalia partner through the SkyTeam global alliance of air carriers.

Air France-KLM, the largest airline company in the world in terms of total operating revenues, also has said it is interested in Iberia Airlines of Spain.