Alitalia – Linee Aeree Italiane S.p.A. was established on 16 September 1946 as Aerolinee Italiane Internazionali. It was formed as a result of an Anglo-Italian agreement and was funded by the Italian Government and British European Airways (BEA) in a 60/40 share arrangement with a capital of 900 million lire (£1,000,000). Its popular name, Alitalia, blended the Italian words ali (wings) and Italia (Italy). It started operations on 5 May 1947, in which year it carried over 10,000 passengers. The inaugural flight was with a Fiat G.12 Alcione, piloted by Virginio Reinero from Turin to Catania and Rome.
The first intercontinental flight left a year later, flying between Milan and cities in South America. The Savoia-Marchetti SM.95 four engined airliner was used on European routes up to 1949. On 31 October 1957, Alitalia merged with Linee Aeree Italiane and took on the name of Alitalia Linee Aeree Italiane. Alitalia was owned by the Italian Ministry of the Treasury (49%), other shareholders, including employees (49%) and Air France-KLM (2%, now: 25%).