Air France to Purchase KLM
AIR FRANCE AND DUTCH AIRLINE KLM ANNOUNCED TODAY THEY ARE NEGOTIATING an agreement that will lead to the creation of the world’s third largest airline. The deal calls for Air France to buy KLM for an estimated $900 million in stock. Target date for the final agreement is Oct. 15. In a joint statement issued Today, the airlines said the new group will be called Air France–KLM to capitalize on brand recognition and the airlines’ complementary networks. The Air France Board has authorized Air France chairman and CEO Jean-Cyril Spinetta to sign the agreement.
“We have always been convinced of the necessity of consolidation in the airline industry,” said Spinetta. “Today, we announce a combination with KLM that will create the first European airline group, which is a milestone in our industry.”
The supervisory board and board of managing directors of KLM have also recommended the transaction.
“KLM has been pointing out the need for consolidation in light of the challenges facing our industry and we have not made it a secret we were looking for a strong European partner,” said Leo van Wijk, KLM president and CEO. “Through this innovative partnership with Air France and our subsequent expected participation in the SkyTeam alliance, we are confident that we have secured a sustainable future for our company.” —Lisa Matte
September 30, 2003
Posted in: Airlines & Railways