Joe747 is right about how he described the deal. When it closes, KLM shareholders will own around 20% of a new holding company that will own both airlines. The airlines will operate under their own names, but will obviously cooperate very tightly.

As for alliance partners, I am not certain that there will be much change there (i.e. NW dumping partners when it joins SkyTeam). In the other major alliances, each airline has it's own set of partners that are available for the members of that particular airline's ff program, but would be unavailable to the other alliance ff members.

At any rate, NW entry into SkyTeam is a long way off because of the regulatory hurdles that must be jumped in order to facilitate a cross border merger as is being discussed in Europe. I don't know for sure, but it's possible the AF/KL merger would require regulatory approval here in the US also due to existing agreements between NW and KL. Certainly any plans for NW to join SkyTeam, even when they are invited, would require FTC approval.