“Air France in the balance”

http://www.bbc.co.uk/news/business-44021431

Air France in the balance according to the above BBC report from a few minutes ago.

What will happen to the next round of mergers with VS if this happens ( and I’m guessing it’s quite a big if )

I ”think”the AF KLM structure is quite complicated anyways.

David

What mergers with VS? Alf/KL have a share holding in VS but in no way shape or form was it a merger.

The AF/KL group is analogous to IAG - it’s a holding company with separate airlines beneath it. So AF could fail but KL be (relatively) unaffected.

The joint venture (again not a merger) hasn’t yet started so the impact on VS will be minimal. it’s DL that could have a big problem as AF is part of skyteam and it throws a lot of business their way (and vice versa)

Ok. Poor choice of words on my behalf !

What do you think will happen to the proposed purchase of 31% of Virgin Atlantic by Air France - KLM ?

https://uk.reuters.com/article/us-brita ... KKCN1GQ2U4

Nothing. AF will survive this it’s all politics threatening to lose the ‘national’ airline.

I also think we need to recognise the influence Delta has over AF KLM. This stake AF is taking in VS is basically DL through the back door.

Agreed. There’s no way the French government would let AF go under. France is far too proud a country to let its national flag carrier collapse. The government’s just trying to scare the staff and the unions into submission.

The French government only own ~14% of the combined AK-KLM group so it's not totally their decision. The private investors are the ones in control.

The French government have already said they won't help and that would fit in with President Macron's reforms in France. They haven't stepped in with the strikes on SNCF (which the French State does wholly own) for example.


As to the AF-KLM group buying VS shares well that's on until it is off and there is still sometime to go before it is finalised as it is conditional on the US and EU giving their regulatory approval for the joint venture between DL-VS-AF-KL.

From memory the VS tie up was expected to be finalised by Q1 19. Lots of unanswered questions around the actual details of this so it’s a big wait and see.

Agreed. There’s no way the French government would let AF go under. France is far too proud a country to let its national flag carrier collapse. The government’s just trying to scare the staff and the unions into submission.

And similarly the Dutch government probably won't allow KLM to go down with Air France if it came to that. I seem to recall an approach was made by BA for KLM years ago which came to nothing and was before they merged with Iberia to create IAG. If a de-merger took place, I'm sure IAG would love to get its hands on KLM.

Agreed. There’s no way the French government would let AF go under. France is far too proud a country to let its national flag carrier collapse. The government’s just trying to scare the staff and the unions into submission.

And similarly the Dutch government probably won't allow KLM to go down with Air France if it came to that. I seem to recall an approach was made by BA for KLM years ago which came to nothing and was before they merged with Iberia to create IAG. If a de-merger took place, I'm sure IAG would love to get its hands on KLM.

Let's drop the notion of a 'national carrier'. It's a long dead concept.

AF and KL are still separate companies under a single holding company. What happens to AF does not automatically affect the KL side of thing. It's the same structure as IAG - a holding company with subsidiary airlines.

The Dutch government owns (as far as I can find) no shares in AF-KLM.

Will it be interested in what happens yes but will it intervene then no.

Try telling that to the Italians.