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Alitalia seals accord with Air France: Alitalia board
2009-01-12
ROME (AFP) - Italian airline Alitalia will sell Air France-KLM a 25 percent stake for 323 million euros under a cooperation accord, Alitalia officials said Monday, paving the way for a revamped Alitalia to begin operations on Tuesday. "Today the board of directors unanimously approved the Air France offer," Alitalia head Roberto Colaninno told a press conference. Air France-KLM will a acquire the stake for around 323 million euros (433 million dollars) and become Alitalia's leading shareholder, according to a joint statement by the two companies. The alliance will guarantee Alitalia's administrative autonomy from Air France-KLM, which will have three seats on the 19-member board of directors and two positions on the nine-member executive committee. Alitalia special administrator Rocco Sabelli said the French-Dutch carrier was "the best strategic partner" for Alitalia and had shown "a determination and a willingness" that other potential partners -- British Airways and Germany's Lufthansa -- had not. The new arrangement was expected to produce benefits for Alitalia of around 720 million euros over the next three years, company officials estimated. A revived Alitalia, formed from a merger in December of the passenger transport units of the old company and Air One, Italy's second largest carrier, was to operate its first flights on Tuesday. Neither the name nor the company's logo would change. Alitalia and Air France-KLM, partners in the SkyTeam alliance, have had close ties for nearly a decade, each with a two percent stake in the other until Alitalia sold its interest to shore up its bottom line. After months of tense negotiations with unions, a local investors' group, the Italian Air Company (CAI), saved Alitalia from the brink of bankruptcy, finalising a takeover plan that called for 3,250 job cuts in mid-December. The deal to acquire Alitalia's passenger operations entailed its merger with Air One. Jettisoning unprofitable routes, the new company will serve 23 domestic and 47 international destinations, of which 13 will be intercontinental. The carrier will operate 670 flights a day, compared with 1,050 previously. Air France-KLM came close to buying Alitalia early last year but dropped the plan due to union opposition.
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