(Bloomberg) -- Italy plans to reset months of talks to find a buyer for its troubled airline ITA Airways, a decision that reopens a possible involvement of Germany’s Deutsche Lufthansa AG in the deal, according to people familiar with the matter.

The new government led by Giorgia Meloni is set to restart talks with MSC Mediterranean Shipping Company SA and Lufthansa after a period of exclusive with a group led by Certares Management together with Delta Air Lines Inc. and Air France-KLM ended with no deal, the people added, asking to not be named as the plans are not public.

The proposal to reopen the race between the two rival bids reflects the new government’s intention to seek a strong industrial partnership, rather than favoring a purely financial investment, the people said. 

Going back to the drawing board on the deal to sell the airline that emerged from the ashes of troubled former flag carrier Alitalia would allow the government to retain up to 49% of the company, they said. Talks with MSC and Lufthansa are expected to take place in coming weeks, they added.

Keeping the airline in business has been a challenge for decades for Italian governments, and several efforts to engineer deals have failed, requiring the state to pour billions to keep it flying.  

A spokesperson for the government declined to comment. A spokesman for ITA declined to comment. 

Lufthansa has been frequently linked to plans to reboot ITA, given the two groups could benefit from joint commercial strategies for the business.

“Lufthansa Group remains interested in the Italian market,” a spokesperson for the airline said Wednesday. “We are monitoring the further sale process of ITA and remain interested in a genuine privatization of the airline.” 

Last month, the German airline said ITA is no longer an attractive investment after the government of then Prime Minister Mario Draghi cut the stake available for purchase from 80% to 50% plus one share.

MSC didn’t respond immediately to a request for a comment.

Air France-KLM declined to comment beyond its statement on Tuesday that it is reviewing options for the Italian market after the end of exclusive talks on ITA.

The next major event for ITA will be its Nov. 8 board meeting, when a €400 million capital hike is expected to be announced. 

Finance minister Giancarlo Giorgetti, who is handling the deal on behalf of the government, could also back the resignation of chairman Alfredo Altavilla after the board stripped him of his powers, adding a boardroom fight to the long list of woes for the airline. 

 

--With assistance from William Wilkes, Tommaso Ebhardt and Albertina Torsoli.

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