Italian airline Alitalia said on Tuesday it will not renew its partnership with Air France-KLM when it expires in January as it is "no longer beneficial".
The Franco-Dutch carrier's share in Alitalia fell to 1.1 percent last August when the United Arab Emirates' Etihad Airways acquired a 49 percent stake in Alitalia.
"These agreements are no longer beneficial, either commercially or strategically, to the new Alitalia and its ambitious turnaround plan," Alitalia's chief executive Silvano Cassano said on Tuesday in a statement.
"We have indicated to Air France-KLM that we are willing to discuss more equitable arrangements that benefit all the parties involved but we have been unable to achieve this result," Cassano added.
Formerly state-owned Alitalia's current management has forged a new business plan aimed at returning the carrier to profitability in 2017, which is focused on more profitable long-haul flights.
It wants to capture a bigger share of outbound cargo traffic and Italy-bound tourist flights, according to Cassano.
The deal with Ethihad was part of a 1.7 billion rescue plan to avoid Alitalia's second bankruptcy in six years and kickstart an ambitious restructuring of the Italian carrier.
Alitalia was on the verge of bankruptcy in 2009 when it entered into partnership with Air France-KLM and has not returned a profit since 2002.
Air France-KLM previously held a 25 percent share in Alitalia under the 2009 partnership and joint-venture agreements which involve code-sharing of flights.
