Alitalia SpA, the unprofitable Italian carrier in talks with Etihad Airways PJSC, said business improved at the start of the year as negotiations continue with the United Arab Emirates airline for an alliance.

The Rome-based company said executives briefed the carrier’s board today on the status of discussions, according to an Alitalia statement. It didn’t give additional details.

The Italian airline’s financial situation at the start of 2014 improved from a year ago, Alitalia said without providing figures.

Alitalia is seeking fresh capital from Etihad after failing to persuade Air France KLM Group to participate in a capital increase last year. Italian daily Il Messaggero reported April 20 that Alitalia’s debt remains the “main knot to untie” before an agreement can be reached.

For Etihad, a stake in Alitalia would give it one more base from which to funnel traffic through Abu Dhabi. Etihad had no comment on today’s Alitalia statement.

Italian Transport Minister Maurizio Lupi on April 17 told lawmakers in parliament that the government favored a deal with Etihad though he declined to provide details on what conditions the carrier has set.


To contact the reporters on this story: Andrea Rothman in Toulouse at [email protected]; Chiara Vasarri in Rome at [email protected] To contact the editors responsible for this story: Benedikt Kammel at [email protected] Dan Liefgreen

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