Rome  - Italian state-controlled carrier Alitalia faced bankruptcy Thursday when a group of Italian private investors withdrew their takeover after labour unions rejected a job-cutting government- backed rescue plan.

The investors CAI, announced their decision in a statement, the ANSA news agency reported.

The statement was issued after the expiry of an afternoon deadline, set by the CAI's head Roberto Colaninno, by which time the nine unions representing Alitalia employees had to agree to the plan.

Six of the unions including several representing pilots and flight attendants rejected the plan, which according to CAI would have involved 3,000 job cuts.

"We're standing on a precipice," Prime Minister Silvio Berlusconi was quoted as saying by the ANSA news agency. The conservative premier also blamed the unions, in particular the leftist CGIL, for failure of CAI's bid.

Reacting to CAI's withdrawal, Rome Mayor Gianni Alemanno, said the situation with Alitalia is "the greatest industrial crisis" to hit the Italian capital.

Alitalia which employs some 20,000 people centres its operations at Rome's Fiumicino airport. (dpa)