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US-Italian consortium pulls out of Alitalia bidding race

Texas Pacific Group (TPG), a US investment fund and turnaround specialist, announced Tuesday that it had pulled out of the bidding race for Italian airline Alitalia.

In a statement, the consortium formed with Italian investment bank Mediobanca and Matlin Patterson said it could no longer comply with the conditions it had previously prescribed and that it would not be proceeding further. The move comes less than a week after Alitalia's board revealed widening 2006 losses of €626 million ($841 million), up €458 million from 2005. The Treasury has put its 49.9% stake in the troubled carrier up for sale in a bid to revive the company's fortunes. Just two bidders are now left ahead of a July 2 deadline: Russian airline Aeroflot-Bank Unicredit and Lufthansa's Italian partner Air One, which is backed by the Intesa San Paolo bank. (monstersandcritics.com)