Milan business leaders threw their weight behind a promised counter-bid for Alitalia on Monday, hoping to prevent cutbacks at Malpensa, the airline's northern Italian hub.
Domestic rival AirOne -- whose previous bid for the state's 49.9 percent stake in Alitalia was snubbed -- said on Sunday it would present an offer soon for the airline, which is in exclusive talks until mid-March with Air France-KLM.
Milan's Chamber of Commerce said it may back AirOne's bid, which has the support of Italy's biggest retail bank, Intesa Sanpaolo. AirOne is challenging Alitalia over the exclusive talks in court and has a first hearing on Tuesday.
"AirOne simply asked to be able to present a final proposal," Intesa Sanpaolo Chief Executive Corrado Passera told reporters at a forum on Expo 2015 on Monday.
Passera said the group backing AirOne's bid was not yet complete but there was "strong interest" from northern business leaders and other banks.
Pirelli could make a small investment in the initiative, but would first want to see the details, a source close to the matter said.
Weekend newspapers said Pirelli Chairman Marco Tronchetti Provera and other Milan-based business leaders such as fashion designer Giorgio Armani could join AirOne's bid. Pirelli has declined comment.
Air France-KLM backs plans for Alitalia to reduce flights at Malpensa by 70 percent, while AirOne has said it would keep the airport's standing.
Alitalia is discussing an all-share offer from Air France-KLM worth 0.35 euros per share but investors are betting the offer will either be raised or AirOne's rival bid will gain ground. Alitalia shares ended up 4.75 percent at 0.69 euro.
On Sunday, Italy's Economy Minister Tommaso Padoa-Schioppa said the sale would go ahead despite the resignation of Romano Prodi's government, which looks likely to head to an election. Opposition leader Silvio Berlusconi is the poll favorite.
In a Monday interview with France's La Tribune newspaper, French Secretary of State for Transport Dominique Bussereau said the demise of Prodi's government could make talks over Alitalia more difficult, but did not put a stop to them.
Adding a sense of urgency, Alitalia said on Monday its delicate financial state put constraints on the calendar for the talks.
Malpensa operator SEA will seek USD$1.86 billion in damages from Alitalia over the airline's plans to cut flights at the airport, about 40 km (25 miles) northwest of Milan, Italy's financial and fashion capital.
Alitalia said it had not yet been notified of the legal action threatened by SEA, but legal sources said it should happen by Friday.
Local politicians, with an eye on their electoral heartland, and business leaders weighed into the debate over the airport's future as Milan bid to host the Universal Exhibition in 2015.
"We are asking for a moratorium of at least two years, any other proposal would be unacceptable," said Luca Cordero di Montezemolo, head of business group Confindustria.
Italy's wealthiest and fastest-growing areas are in the north, and many are served by Malpensa for international flights.
The local Lombardy region "cannot be penalized, I hope the government understands that," said the region's governor, Roberto Formigoni.
Ahead of a key meeting on Malpensa this week, Padoa-Schioppa said he did not understand why the country's richest region could not present a business project to safeguard Malpensa and Alitalia's future.
