EU antitrust regulators will investigate whether Italy's decision to grant €900 million in aid to troubled airline Alitalia breached the bloc's state aid rules.

Alitalia, in which Etihad Airways holds a 49 per cent stake, was placed under extraordinary administration in May 2017. Italian authorities gave a total of €900 million to the carrier to ensure its financing during this period while also opening a tender aimed at finding a buyer for its assets.

The European Commission can order Italy to recover the money if it finds that the aid is illegal.