Alitalia, the bankrupt Italian airline, is selling off its multimillion-pound collection of modern art to help to reduce crippling debts, as it prepares for a relaunch next month under new ownership.

The collection includes works by some of the 20th century’s most bankable artists, including Salvador DalÍ, Giorgio De Chirico and Giacomo Balla. Alitalia also holds paintings by the leading Futurist panter Gino Severini, who, towards the end of his life, was commissioned to paint works for the airline’s Paris offices.

Art experts said Alitalia held nearly 200 significant modern works of art. While not all would fetch high prices, about a quarter of the collection was “extremely valuable”. In June a painting by Severini entitled La Danseuse sold for £15 million at Sotheby's in London, making it the most expensive Futurist work yet auctioned.

The collection includes works by Giuseppe Capogrossi, Renato Guttuso, Mario Sironi, Fortunato Depero, Ottone Rosai and Massimo Campigli, as well as sculptures by Giacomo Manzu and Mario Ceroli.

The sale is unlikely, however, to include Ceroli’s massive and intricate sphere, entitled Squilibrio (Imbalance), which stands at Fiumicino airport outside Rome and is intended as a homage to Leonardo Da Vinci, the Renaissance genius who foresaw manned flight.

Officials at Alitalia, which began flying in 1947, said the collection had its beginnings during happier times in the 1950s, when the airline bought modern art works to decorate its boardrooms, VIP lounges and even its fleet of DC8 aircraft. The policy was intended to show the world the best of Italy on the country’s flag carrier, officials said. The artworks are now at Alitalia offices in Rome, Milan, Turin and New York, or in storage.

The sale has been authorised by Augusto Fantozzi, the law professor who took control in August of the strike-prone, state-owned airline as bankruptcy commissioner. Professor Fantozzi has asked four auction houses to consider evaluating the collection. Last week he announced that, despite protests by Alitalia trade unions, he had agreed to sell the airline to a group of Italian investors, CAI, in a deal worth more than €1 billion (£840 million). CAI will pay €427 million cash and take on €625 million of debt.

He said the handover would take place on December 1 but ENAC, the Italian aviation authority, said yesterday that the relaunch would be delayed till mid-December as “loose ends” were tied up, including final talks with the unions and the sale of some assets.

In a deal that some of Alitalia’s rivals say amounts to state favouritism, CAI will acquire only Alitalia’s more profitable assets, buying or leasing 93 of its 173 aircraft and merging it with Air One, Italy’s second-biggest carrier.

It will, however, have to cut jobs and routes and sell off assets to help to reduce inherited debt. The remainder of the airline’s €3 billion debt will be taken on by the Italian state, Professor Fantozzi said.

CAI plans to hire only 12,600 of Alitalia’s 20,000 employees. Unions representing pilots and flight attendants have staged wildcat strikes, forcing Alitalia to scrap more than 100 flights a day.

CAI is also seeking a foreign investor to become a minority shareholder. Yesterday Lufthansa stole a march on its rival, Air France, by launching “Lufthansa Italia”, a new airline based at Milan Malpensa, to serve main European cities, including London. A Lufthansa spokesman said it would blend “German reliability with Italian flair”.

The Italian Government and the European Commission have both approved the sale of Alitalia to CAI.

The deal follows a two-year hunt for a buyer that included a failed auction and an aborted sale to Air France-KLM, which Silvio Berlusconi, the Prime Minister, opposed on nationalistic grounds. Alitalia finally filed for bankruptcy in August, crippled by high labour costs, strikes and rising oil prices.

It is expected to report an operating loss of €1 billion this year.

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