Italian business daily Il Sole 24 Ore said on Sunday that Air France-KLM has laid out strict conditions for further investment in Alitalia, including the culling of 5,000 jobs.
Air France-KLM, which currently owns a 25 percent stake in Alitalia, said in a statement that the company did not make such a request.
However, it has demanded that Alitalia undertakes major restructuring before it participates in a capital increase.
Conditions were also reported to include the ousting of Alitalia's board of directors and a vast debt restructuring plan.
Meanwhile, Alitalia chairman Roberto Colaninno said on Thursday he would step down after the airline's capital raise. READ THE FULL STORY HERE.
Alitalia has been trying to persuade shareholders to inject funds as part of a €300m recapitalisation programme.
Shareholders including Air France-KLM have until the middle of November to decide whether or not to participate in the capital increase.
Air France-KLM chief executive Alexandre de Juniac said on Thursday that since talks on recapitalisation began, the French group had been clear about requiring "strict financial, industrial and social conditions" and a "profound restructuring" for Alitalia.
The capital increase plan was put together in a hurry under pressure from the government, as energy major ENI threatened to ground the fleet by stopping fuel supplies because of unpaid debts.