<i> Alitalia risks having its fuel supply cut off on Saturday unless it can reach a deal to keep its business going.

Italian oil firm ENI will stop supplies unless it is reassured by Alitalia's management and the government that it can keep operating.

Alitalia is trying to raise 100m euros ($136m; £84m) from its shareholders to avoid bankruptcy.

Shareholders, which include Air France KLM, are due to vote on a financing deal on 14 October. </i>

http://www.bbc.co.uk/news/business-24455942

I can confirm all that from here in Italy.
The Italian government is optimistic that a deal can be reached this week (well, they would be!).
Watch this space.

Update: the unions had a meeting with Alitalia management today who said that a recapitalization is in the pipeline.

Well this is good news. Almost booked a flight to Abu Dhabi with them but changed my mind to BA at last minute.

A new financial package totalling €500 million was announced last night.

IMHO Alitalia will not become competitive until it brings its business strategy into the 21st century. It still seems to believe in the old flag-carrier philosophy and is trying to remain a world player, in part to satisfy Italian national pride.
Easier said than done of course. The transport sector in Italy is highly unionised and Alitalia is probably grossly overstaffed.

The capital increase (€300 million out of the €500 million total financial package) was approved by shareholders last night and they now have 30 days to pay up.

BUT other European airlines (BA and Iberia) have asked the EU to intervene as they consider part of the package to be state aid. In fact €75 million of the capital increase will be subscribed by Poste Italiane (the Italian Post Office). The government says however that Poste Italiane is a privatised company and denies it is state aid.

This will rumble on for some time I think.

I shouldn't like to mislead anybody. When I said in my previous post << The government says however that Poste Italiane is a privatised company and denies it is state aid >>
I should add that, yes, Poste Italiane is now a SpA (limited company) but its shares just happen to be held 100% by the Italian Treasury.

That is why other airlines are complaining about State aid and in fact today the EU says it is expecting an explanation from Italy.
We shall see.