Italy airport rejects Ryanair

MILAN (Reuters) - Malpensa has rejected Ryanair's offer to operate out of the international airport, describing as "unacceptable" a plan made by the airline at time when the future role of Italy's northern hub has come under doubt.

Ryanair (RYA.I), Europe's largest discount airline, had presented a plan in September after Alitalia's latest reorganisation envisioned halving the number of flights out of the airport near Milan, Italy's financial and fashion capital.

Alitalia's AZPIa.MI plan raised the ire of unions and regional politicians for fear of seeing Malpensa become less important to Alitalia than its other hub in Rome, Fiumicino.

And those fears were revived this weekend after the board of the money-loosing flagship carrier came out in favour of a bid from Air France-KLM (AIRF.PA) to take it over.

Politicians were joined by union leaders in criticising the decision, saying Air France-KLM would treat Alitalia as a regional airline and transfer major routes to Paris to the detriment of Malpensa and Fiumicino.

After months of talks, the head of the management company behind Malpensa airport told the Corriere della Sera newspaper on Sunday that he had turned down Ryanair's offer.

"The project was unacceptable," he said.

"Nothing will be done, at least in 2008," SEA Chairman Giuseppe Bonomi said. "You should never say never, but they (Ryanair) have to soften their position."

Bonomi said Ryanair would have obliged SEA to change its strategy completely, and the tariffs it wanted to charge passengers were too low for the airport.