A possible lifeline for Alitalia appeared closer Sunday as the Italian flag carrier said that Etihad Airways was close to deciding if it would commit to an investment.

The two airlines announced in December that talks were ongoing over a possible investment by Abu Dhabi-based Etihad in loss-making Alitalia.

Alitalia received a €300 million ($413 million) cash injection some weeks ago, but continuing heavy losses had led some observers to forecast another financial crunch for the Italian airline by the middle of the year.

A brief statement Sunday by Etihad president and CEO James Hogan and Alitalia CEO Gabriele Del Torchio Alitalia said the two airlines “have entered the final phase of a due diligence process about a possible investment by Etihad Airways in Alitalia.

“During the next 30 days both companies and their advisors will determine how a common strategy can be developed which meets the objectives of both parties.

“Any issues that may prevent the establishment of an appropriate business plan will have to be resolved to ensure the plan can be implemented to move Alitalia to sustainable profitability.”

SOURCE ATW, Read more..