Alitalia - Linee Aeree Italiane nears financial collapse while struggling to get union leaders to accept a takeover by Air France-KLM. The union said it is willing to continue negotiations after their unreasonable demands have forced Air France-KLM out of takeover talks. The takeover involves buying a 49.9 percent stake, which is currently owned by the Italian state.

Meanwhile, the Italian government pushes the company and its unions to reach a deal quickly. "If you want to have a dialogue, you cannot say take it or leave it within 24 hours," Guglielmo Epifani, general secretary of Alitalia's Cgil union, told La Stampa daily on Sunday.

Newspaper reports from Italy allege that Alitalia only has funds to continue operating until June. It is estimated that it currently loses around one million euros a day. Alitalia is the world's 19th largest passenger airline by fleet size and operates services to 28 domestic and 74 international destinations.

It was established in 1946 and started operations in 1947. Air France-KLM already has a 2 percent stake in Alitalia, with 49 percent owned by the Italian Ministry of the Treasury and the rest by various other shareholders, among whom employees.

Last month, Air France-KLM offered a deal involving a share swap of 0.10 euro per share, a total of 138 million euro for the 49 percent stake. Also, the group offered to pay 608 million euro for the convertible bonds issued by Alitalia and pledged to invest 1 billion euros. The deadline was March 31. The main point of disagreement was that the fate of the about 7600 employees of Alitalia's maintenance subsidiary, Alitalia Servizi, is uncertain and the company's freight service will be canceled by 2010.