An aircraft owned by Wind Jet taxis on the tarmac. (file photo)
Hundreds of passengers are stranded as Italy’s cash-strapped budget airline Wind Jet halts all its flights.
Wind Jet officially stopped operating flights Sunday due to the failure of Italian national carrier Alitalia's deal to purchase the Sicily-based low-cost carrier, the Associated Press reported.
Wind Jet reportedly failed to turn over company financial data under an April agreement.
The situation, during Italy's peak summer holiday travel period, could affect some 300,000 passengers holding tickets for flights scheduled through October.
Alitalia walked out of the negotiations begun several months ago after Wind Jet boss Stefano Rantuccio accused it of trying to impose damaging conditions on his company.
Alitalia charged that Windjet clearly had no intention of respecting provisional agreements aimed at saving the budget operator.
Italy's economy has shrunk for the fourth quarter in a row, contracting 0.7 percent in the three months through June, underlining a deepening recession in the country.
Italy, the eurozone's third largest economy, also saw unemployment rise in June to a new record high of 10.8 percent, the highest in almost 13 years.
The continued recession is gloomy news for Italians, who have seen a series of austerity packages, tax hikes and pension charges as they struggle to battle off the debt crisis.