Italy considering state entity investment in Alitalia


ROME, Oct 7 (Reuters) - The Italian government isconsidering an investment by a state entity in troubled nationalcarrier Alitalia while talks with Air France-KLM continue, a source close to the situation said onMonday.

The Franco-Dutch carrier is considering raising its 25percent stake in Alitalia, but a deal is being held up bydisagreements over strategy and finances.

"The government is considering how to support and helpAlitalia towards a more realistic solution, which is the mergerwith its French shareholder Air France-KLM. It is evaluatingwhich public entity can help Alitalia in this process," thesource said.

The government has asked state railway operator Ferroviedello Stato to consider investing in Alitalia, thoughFerrovie CEO Mauro Moretti was not at the shareholder meeting,according to the source. Talks on the future of Alitalia willcontinue Tuesday after "very tense" negotiations on Monday, thesource said.

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