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Air France and Alitalia in tentative tie-up talks

Air France and Alitalia in tentative tie-up talks
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Air France-KLM has said exploratory tie-up talks are underway with Alitalia, on the Italian airline’s request. Air France-KLMCEO Jean-Cyril Spinetta said, tentatively, back in March, that a merger was possible. “Alitalia is not ready to, as we say in French, to ‘monter dans le train’, to ‘go in the train’, not the aircraft, at the first stage. May be it will ‘go in the train’ in the second stage and we will have, of course, to decide this all together, Alitalia, and Air France-KLM.”

Air France-KLM half-year turnover was 12 billion euros compared to Alitalia’s two billion. The Franco-Dutch group carried more than three times the number of passengers. It has 564 aircraft compared to Alitalia’s 185. Air France-KLM shares slid on Spinetta’s statement and the company subsequently clarified that no merger negotiations were underway.

Alitalia’s shares, meanwhile, leapt up. The disclosure of talks came as Italian Prime Minister Romano Prodi prepared to raise concerns about any eventual merger at a Franco-Italian summit in Italy. Prodi says he has supported contacts between the two groups in the past but now has doubts and would like to know more about Air France’s real intentions towards the state-owned airline.