UPDATE 1-Italy eyes Alitalia deals, not merger, in France

(Adds quotes, nature of tie-ups, background)

PARIS, Sept 16 (Reuters) - Italian Prime Minister Silvio Berlusconi told French President Nicolas Sarkozy he wants tie-ups between Alitalia, Air France (AIRF.PA) and Lufthansa (LHAG.DE) but was not talking of a merger, a French source said.

At a meeting with Sarkozy in Paris on Tuesday, Berlusconi said he was in favour of business agreements between the three airlines, an official in Sarkozy's office said, adding that such deals could include codeshare agreements or jointly managing airport terminals, but not a takeover.

"Silvio Berlusconi indicated that what he wanted, when the time comes, was for there to be commercial alliances with Air France, with Lufthansa, and that things were open," the official said on condition of anonymity.

The Italian Prime Minister said on Monday Lufthansa would be the best international partner for the new Alitalia once a deal was reached with Italian unions.

Last year, the previous, centre-left, Italian government agreed to sell the state's 49.9 percent stake to Air France-KLM, but the Franco-Dutch carrier walked away due to opposition by unions. Berlusconi also said he would block the deal if he was returned to power.

Now operating under a bankruptcy commissioner, Alitalia risks becoming the first major European flag carrier to go bust since Swissair collapsed in 2001. Belgium's Sabena also filed for bankruptcy in 2001.

Before looking at tie-ups with airlines such as Air France, however, Berlusconi was concentrating on finding a lasting solution for Alitalia, the French official said.

"The point he is focused on for the moment is finding a solution for the company's survival," he said. (Reporting by Emmanuel Jarry; writing by Francois Murphy, editing by Richard Chang)