LONDON - THE chief executive of British Airways has expressed strong interest in a commercial alliance with Alitalia, the Financial Times reported on Saturday.

'We believe we have made a very credible and potentially exciting proposition for the new company (Alitalia),' Mr Willie Walsh told the daily business newspaper.

Italian investor group CAI last week submitted a binding offer to take over failing Alitalia for 325 million euros (S$622.8 million).

The Italian carrier, which is 49.9 per cent state-owned, is losing about three million euros a day and has debts of some 1.2 billion euros.

The new concern will need the participation of an established foreign airline to remain viable and Air France-KLM and Lufthansa are among others to express interest.

The FT quoted Mr Walsh as saying that BA was not interested in investing an equity stake in Alitalia and had been assured by CAI that this would be no impediment to the airlines forming a commercial alliance.

Mr Walsh's comments were published the day after BA announced a 91.6 per cent plunge in half-year profits amid tough trading conditions and high fuel prices.

Shares in the airline surged as the figures were better than analysts predicted. -- AFP