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SkyTeam Air France/KLM Deal

SkyTeam Air France/KLM Deal


Old Sep 17, 03, 11:04 am
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SkyTeam Air France/KLM Deal

Posted on Wed, Sep. 17, 2003 (AP)

Air France, KLM Plan More Alliance Talks
Associated Press

PARIS - Air France and KLM Royal Dutch Airlines still have to negotiate "critical points" in talks on an alliance that would also bring KLM into the SkyTeam group, the companies said Wednesday.

The European airlines confirmed they were in advanced discussion on "an intensive cooperation," but their joint statement did not specify whether that meant a full-scale merger.

Until Wednesday, some observers had seen a tie-up as a done deal. However, the statement - as well as Air France's announcement that it would not convene a board meeting Wednesday - dimmed hopes of a rapid merger.

"These negotiations are in an advanced stage," the statement said. "However, critical points are still under discussion between the parties."

Besides bringing the two airlines together, the companies want to make KLM part of the SkyTeam code-sharing alliance that already includes Delta, Aeromexico, Alitalia, Air France, CSA Czech Airlines and Korean Air.

KLM has been looking for a partner airline for years. An agreement with Alitalia broke down over the Italian airline's slow privatization. Air France has been named as the likely candidate for months.

In anticipation of consolidation in Europe's airline sector, "KLM is looking for a strong European partner," said KLM spokesman Bart Koster.

"Air France is who we are talking to now," the spokesman said, adding that other possibilities included British Airways and Lufthansa.

KLM wants guarantees about maintaining its brand, its Dutch identity, Schiphol airport as a hub and its partnerships with global airlines, Koster said. The carrier also wants to make sure that its roughly 40,000 jobs are maintained.

Air France denied reports that its board was to discuss the alliance Wednesday. The issue was also scratched from the agenda of a works council meeting with employees, a union source said.
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