The Italian government has signed paperwork creating a new aviation company, beginning the restructuring of Alitalia. The move comes as part of wider €3 billion recapitalisation of the airline.

Delta Air Lines and easyJet have confirmed they are in talks over the future of Alitalia. The American carrier and UK-based low-cost airline confirmed they have linked with Italy’s state-backed railway company Ferrovie dello Stato to examine a bid for the flag-carrier.

German flag-carrier Lufthansa has made an offer to buy parts of stricken Italian carrier Alitalia. The aviation giant is joined by easyJet of the UK, which has also put forward its own proposals.

Alitalia will enter bankruptcy proceedings after staff at the Italian flag-carrier rejected a restructuring plan. In the short-term the carrier’s flight schedule will continue to operate as planned, as administrators examine whether the airline is viable.

Alitalia has delivered strong progress in the 18 months since the launch of a major industrial plan to re-engineer the airline to compete effectively on the global aviation stage. The new Alitalia began operations on January 1st, 2015 following a €1.76 billion recapitalisation that saw historic debt wiped out and a €560 million investment by Etihad Airways for a 49 per cent equity stake.

Alitalia confirmed today it is on track to become profitable by 2017, as it reduced its losses by €381 million in 2015 compared to the previous year. This important result for 2015 comes as the airline announced its first full reporting year under a three-year turnaround Industrial Plan. After posting total revenues of €3,312.4 million in 2015, Alitalia was able to report a net loss of €199.1 million for 2015, a significant improvement on the €580 million loss recorded in 2014.