A consortium of investors proposing to rescue airline Alitalia has withdrawn its takeover offer, raising fears the carrier may go into liquidation.

The Italian group, called CAI, dropped its bid after unions failed to back the deal before a 1400GMT deadline.

While four of Alitalia’s unions had supported the deal, five had objected because of plans to cut 3,000 jobs.

Italy’s flag-carrier has already warned that it is running out of funds to buy all the aviation fuel it needs.

Making its announcement, CAI said it expressed “profound disappointment”.

“Further concessions would inevitably have put the realisation of the plan at risk,” it said.

Cancelled flights

Italian Labour Minister Maurizio Sacconi said before the deadline that the future of Alitalia was “hanging by a thread”.

“The company is dead and some of my colleagues want to be its undertakers” Head of the UIL union, Luigi Angeletti

While Italy’s four main union organisations – CGIL, CISL, UIL and UGL – had signed up to the agreement with the CAI, five other unions had rejected the deal as “useless and provocative”.

Those opposed to the package – SDL, ANPAC, UP, ANPAV and Avia – include pilots and cabin crews.

Their protests forced Alitalia, which is losing 2.1m euros ($3m; £1.7m) daily, to cancel 40 flights on Wednesday.

The head of the UIL union, Luigi Angeletti, attacked those unions that rejected the CAI offer.

“The company is dead and some of my colleagues want to be its undertakers,” he said.

Government role

Under the CAI rescue proposal, the Italian consortium had put forward a 1bn-euro offer for the airline.

It wanted Alitalia to merge with Air One, the country’s second-largest airline, while its 1.2bn-euro debt would be absorbed by a second firm, which would then be liquidated.

Prime Minister Silvio Berlusconi has pledged to do all he can to save Alitalia, in which the Italian government holds a 49.9% stake.

In April, plans for the airline to be taken over by France-KLM collapsed when unions refused the accept the terms of the deal.

Alitalia suspended trading in its shares in June and filed for bankruptcy protection last month.

News reported by The BBC

House of Fraser has delivered a healthy uplift in sales and profits, as the changes made by its new management team bear fruit despite tough trading conditions on the high street.

The 61-department store chain, which was acquired by a consortium led by the Icelandic investment group Baugur in November 2006, delivered total sales up 2.9 per cent for the 26 weeks to 26 July.

The figures suggest House of Fraser is holding its own on the high street, against rivals such as Selfridges and John Lewis, but it did not provide like-for-like sales, based on stores more than a year old, and its sales were boosted by two stores opening in Belfast and High Wycombe in March. House of Fraser said that its underlying earnings (Ebitda) were up by more than 30 per cent in the past 12 months.

Robert Clark, a senior partner at the market research firm Retail Knowledge Bank, said: “I suspect it masks a small fall in like-for-like sales. But the profit figure is reasonable and this shows they are watching costs very carefully.”

House of Fraser said the uplift in profits and sales had been driven by refurbished stores, improved stock management, the introduction of new products and high-margin private-label products, including its Linea line, which has been extended into handbags, accessories and home. It said it had reduced stock levels by 5 per cent and cut back on poor-selling stock significantly. House of Fraser said that sales at its 13 refurbished stores are 8 per cent ahead of the rest of the chain.

Don McCarthy, House of Fraser’s chairman, said: “Our three-year investment programme is well under way, and we are delighted by the performance of our new stores which were opened earlier this year in both Belfast and High Wycombe.”

House of Fraser, whose chief executive is John King, said it had invested £150m in the business since it was bought by Highland Acquisitions in November 2006 and that it had repaid or cancelled £110m of the original debt since then.

The department store chain, which generates annual sales in excess of £1.25bn, is to open two more stores in Bristol next month and London’s White City in October.

News reported by The Independent

Informa has received a tentative 506p-per-share approach from a private equity consortium which would value the trade fairs and scientific journals business at £3.4bn including debt, the company said on Tuesday night.

If successfully completed, the approach from Providence Equity Partners, Carlyle Group and Hellman & Friedman would rank as the world’s largest private equity bid since leveraged finance markets seized up late last summer.

The proposal would value Informa’s equity at £2.15bn, on top of which its net debt stood at £1.25bn at the end of 2007. The consortium has yet to begin formal due diligence.

Investor doubts about the consortium’s ability to finance a deal of this scale have weighed on Informa’s share price, which has fallen from 435p on June 19 when the consortium confirmed it had made an approach. On Tuesday, shares in Informa closed down 8.4 per cent at 378¼p. The company issued its statement after the market closed.

The consortium lined up financing last month from a group of banks including ING and Goldman Sachs, which have offered to provide £1.39bn of senior debt priced at 375 basis points over Libor, and an additional £463m in high-yield debt costing 11.75 per cent.

Providence and its partners made their approach shortly before the collapse of an earlier merger-of-equals proposal from United Business Media, a smaller rival to Informa. UBM has reserved the right to return should the private equity approach come to nothing.

The consortium’s continued interest underlines the private equity community’s appetite for business-to-business media assets, which offer a higher share of annually renewed subscription revenues than most consumer-facing media stocks.

Providence bid unsuccessfully for Emap’s business publishing assets, which were sold in December to Apax Partners. Apax and Candover are expected to show interest should the consortium sell off any of Informa’s assets.

News reported by Financial Times Ltd