Air France-KLM Acquiring 25% of Alitalia

The management of Air France-KLM announced earlier today that they had reached an agreement to acquire a 25% minority share in Italian carrier Alitalia. Calling the move a "new strategic partnership," Air France-KLM says the deal will allow it to have greater access to the Italian market through Alitalia, while strengthening Alitalia's position in both the domestic Italian market, and international markets.

According to Air France-KLM, the airline partnership will pursue a multi-hub strategy in Europe, which will put Rome-Fiumicino and Milan-Malpensa airports "on an equal basis" with Paris-Charles de Gaulle and Amsterdam-Schiphol. (In addition to Rome and Milan, Alitalia now has domestic hubs at Venice, Turin, Naples and Catania.)

As a part of the €323 million deal, Air France-KLM will hold three of the 19 seats on the Alitalia board, and will have two of nine seats on Executive Committee of the Governing Council.

The agreement still must be aproved by the shareholders of Alitalia, as well as by the European Union's regulatory authorities. The parties hope that such approvals will be accomplished before the end of the first quarter of 2009.

Source: AirCrewBuzz