Etihad Airways in talks to buy up to 49% stake in Alitalia Etihad Airways and Alitalia are in advanced talks that would see the Abu Dhabi airline become the largest shareholder in Italy's cash-strapped national carrier. Talks between the two airlines, which have been on and off for months, are focusing on Etihad taking a stake of between 30 per cent and 49 per cent in Alitalia, and include a capital injection of as much as €350m, according to two people familiar with the discussions. Alitalia declined to comment. Bloomberg had earlier reported that a deal could be agreed as early as Thursday. A source close to the discussions said this was unlikely as talks were still continuing. "But if a deal is going to be done, it is going to done in the next few days," the source said. Alitalia is trying to avoid bankruptcy for the second time in five years as it struggles to overcome low-cost competition and rising fuel prices after years of mismanagement and being used as a electioneering pawn by politicians from both left and right. Alitalia has been scrabbling to find a new partner since Air France, its main shareholder with a 25 per cent stake, said it would not participate in the Italian airline's planned €300m capital increase, arguing a turnround plan did not go far enough. In October, Alitalia shareholders approved the capital increase which is partly underwritten by the state postal service and two of Italy's banks, as part of a wider package to cut costs and improve efficiency.