Officials from cash-strapped Italian flagship carrier Alitalia SpA. will travel to Moscow next week to sound out Aeroflot's about an alliance, a person close to Alitalia said on Saturday, The Wall Street Journal reported. The person, who spoke on condition of anonymity, confirmed local news reports about the visit but didn't elaborate. Aeroflot wasn't immediately available for comment. Alitalia is looking for partners and Italian Transport Minister Maurizio Lupi said the government will consider others apart from Air France-KLM, AF.FR -3.80% which has a 25% stake in the carrier.

Air France-KLM, the French-Dutch airline, said Thursday that it had written off the entire value of its 25 percent holding in its partner Alitalia, raising doubts that it will take part in a plan to inject 300 million euros into the struggling Italian flag carrier, The International New York Times reported.

Italy's minister of economic development, Flavio Zanonato, defended the record of Prime Minister Enrico Letta's government, pushing back at critics who say the young administration hasn't been ambitious enough in tackling Italy's myriad economic problems and has sent the wrong signal to foreign investors by pumping more money into near-bankrupt Alitalia, The Wall Street Journal reported. Mr. Zanonato also said the government will launch a series of measures aimed at helping foreign companies invest in Italy, raising the number of startups and freeing more credit for small companies.

Siena, the medieval city renowned for its Palio horse races, is home to the world’s oldest bank. Within its aging walls lies a distinctly 21st century tale of devastation wrought by local politicians and global financiers, Bloomberg reported. Banca Monte dei Paschi di Siena SpA, Italy’s third-largest lender, is struggling to survive as it seeks to repay a second bailout or face nationalization. Its downfall proved a boon to global investment banks. They offered merger and investment advice to executives beholden to politicians that helped wipe out 93 percent of Monte Paschi’s value.

Alitalia's main pilots' union has announced a four-hour strike for Oct. 29 to pressure management for details on how they intend to return the struggling carrier to health, the Associated Press reported. UILT secretary-general Marco Veneziano said in a statement the union could hold more strikes - up to a combined total of 48 hours - until it receives `'a credible plan" for saving Italy's flagship airline. The union rejects proposals for layoffs and demands a clear plan that includes an international partner and new management.

Banca Monte dei Paschi di Siena will sound out foreign investors in London over the next few days to raise support for a hefty 2.5 billion euro (2.11 billion pounds) capital increase that the troubled Italian bank must complete next year. UBS, which is advising the Tuscan lender on the much-needed cash call, is to lead the round of contacts that will in any case be preliminary, a financial source told Reuters on Wednesday.

Italian Prime Minister Enrico Letta reshaped the country’s two-year commitment to austerity by approving a labor-tax cut and relying on 3.5 billion euros ($4.7 billion) of spending reductions to meet 2014 deficit targets, Bloomberg reported. The central government will bear 2.5 billion euros of the expense cuts and regional administrations will deliver 1 billion euros, Letta said in a press conference in Rome after his cabinet approved next year’s budget yesterday. The labor-tax cut will give an extra 1.5 billion euros to workers next year and a total of 5 billion euros through 2016, he said.

Shareholders in the Alitalia airline have agreed to a 300 million-euro ($400 million) capital increase to save Italy's flagship carrier from bankruptcy, the Associated Press reported. It is still unclear which shareholders will contribute. The airline said in a statement Tuesday that the 21 Italian shareholders and Air France-KLM, the largest stakeholder, have 30 days to decide whether to exercise their options to contribute money and increase their stakes. The capital increase can already count on 75 million euros from Italy's postal service and a 100-million-euro bridge loan.

A leading European airline group denounced Italian plans to rescue Alitalia as illegal on Monday, as shareholders were due to vote on a capital increase to keep the near-bankrupt carrier flying, Reuters reported. International Airlines Group, which owns British Airways and Spain's Iberia, urged the European Commission to intervene over the Italian government's attempts to stitch together a bailout for Alitalia.

Alitalia, the Italian national airline that has made a profit only a few times in its 67-year history, once again risks collapsing as the government scrambles to find investors willing to rescue its problem child, Reuters reported. Rome offered a financial lifeline to Alitalia through the state-owned post office, but the plan depends on private shareholders ploughing more money into what many investors regard as a corporate lost cause.