And this is how the game is played. Lufthansa wasn’t interested in Alitalia, they are way too busy with other things: BMI, Austrian, SN Brussels, SAS to only name the ones in Europe. They could never spare the management time to sort out (if that is possible) the sucking chest wound that Alitalia is, and it would not have cleared EU hurdles.
These guys (Air France, Lufthansa, BA) put their heads together and are carving up the European aviation map. With BA being allowed to form a more enhanced alliance (merger) with Iberia. This matches what has occurred in the USA, where three groupings will eventually be created (the Delta/NWA takeover is just the start). It is only a matter of time before Continental and United will make the next move. Probably followed by American and US Aiways (or these guys will fold). All these companies are already connected to each other through the worldwide alliances; Star, One World, and Skyteam.
This will leave only smaller carriers to be bought out or added to these three groupings, if they represent a strategic addition.
KLM had already lost 280 million Euros in an attempt to form a fourth airline grouping with Alitalia back in 2001, at the time anchoring a fourth worldwide alliance (WINGS). This failed because of the tremendous mess that Alitalia was back then. Eventually leading to the buyout of KLM by Air France. Air France/KLM willl pay 310 million for a 25% participation in Alitalia (valuing Alitalia at over 1.2 billion euros). As a reference Air France bought 100% of KLM for 850 million euros (and since this takeover KLM has been responsible for close to 2/3 of all the profits generated within the group). Alitalia is going to cost a tremendous amount of management energy, and of course money, but from a corporate point of view, it is a risk worth taking.
As an airline employee it is maddening to see that not all airlines are created equally. Some are allowed to operate by totally different economic rules, and are not held responsible for the consequences of their mistakes. But that is life I guess.