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Alitalia Goes To Air France – KLM

  • December 23rd, 2007
  • Posted by EUEditor

alitalia-xplanefreeware.jpgThe board of Alitalia has recommended acceptance of a rescue offer from Air France – KLM, which has committed itself to an investment of EU 6.5 billion, (A$10.75-billion; dcerates.com, 23.12.07) .

The move is to be structured as a share swap which will preserve Alitalia as an entity associated with Italy, and keep the brand in use.

Under the plan the loss-making airline would return to profitability in three years.

Directors said Air France-KLM was receiving the highest receipts of any world airline and its management had expertise in restructures.
The Italian government which holds 49.9% of Alitalia shares is expected to announce whether it accepts the deal next month.

Two Italian bidders for Alitalia included Air One, an affiliate of the German company Lufthansa; its proposed merger of the two Italian-based airlines would have been another variant on national airlines, under stress of competition from budget air services, consolidating their resources.

Alitalia is heavily in debt and reported to be losing EU one-million daily.

Picture: xplaefreeware

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