ROME, April 2, 2008 (AFP) - The Italian state will not make a requested 300-million-euro bridging loan to Alitalia unless the failing airline's unions reach agreement with Air France-KLM on the European giant's takeover bid, Economy Minister Tommaso Padoa-Schioppa said Tuesday.

'Without a positive conclusion to the ongoing negotiations, a bridging loan, even taking into account its incompatibility with EU rules, will not be possible,' Padoa-Schioppa told a parliamentary hearing.

Alitalia has sought the loan to tide it over until the one billion euro (1.6 billion dollar) recapitalisation of the Italian flag carrier that Air France-KLM has proposed in its takeover offer.

Padoa-Schioppa said that Wednesday would hold 'decisive hours' for Alitalia, and that an extraordinary administration would be much more painful than the airline's acquisition by Air France-KLM.

Wednesday is the third deadline since last Friday's for the unions and Air France-KLM to find an accord.