Air France
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Fastner: The BA / KLM thing (the last one was a third try) never got to any court. KLM wasn’t a basket case, it was aware that in the long run it needed to belong to one of the three large groupings in Europe, as their previous attempts to bring about a fourth large grouping failed. Among them a coming together with Alitalia (which cost KLM more than 280 million Euros). The two companies went their own way after about a year, mainly because the Dutch couldn’t make the moves that needed to be made to turn Alitalia around. So within the Air France/KLM there is a lot of expertise on what ails Alitalia (almost everything), and what needs to be done to get to grips with it (a lot).
BA wanted to do what the Anglo-Saxon companies do when they take-over a company, which is rape and pillage, extract maximum value from day one. This cost was too high for KLM (it wasn’t destitute or desperate). Air France gave KLM certain guarantees, which gave KLM confidence in the new company and decided to let themselves be bought by Air France. In the new company KLM represents 1/3 of the turnover, Air France 2/3. KLM’s share of the profit is 60%. Air France did not have to invest one penny in KLM. Air France was in profit from day one, as it was a pure stock transaction.
I think BA might be a bit sorry they were unwilling to provide the same guarantees to KLM. Their European strategy is unclear (basically they have to acquire Iberia now, or really be left at the margins), and their main hub will see a whole slew of new competitors flying to the USA soon. It’s answer it to piss off its pilots by trying to bypass them while starting a new division to fly from mainland Europe. Terminal four will become an exclusive Skyteam terminal from October, 2008. BA only controls 38% of all slots at Heathrow. Which is about half the percentage that the other large airlines control at their main hubs in Europe.
I am far from certain Air France/KLM will be able to take over Alitalia. The unions might run it into the ground to prevent the takeover. But even that would be better than leaving the subsidized mess that Alitalia has basically always been alive, distorting the aviation landscape.
BA wanted to do what the Anglo-Saxon companies do when they take-over a company, which is rape and pillage, extract maximum value from day one. This cost was too high for KLM (it wasn’t destitute or desperate). Air France gave KLM certain guarantees, which gave KLM confidence in the new company and decided to let themselves be bought by Air France. In the new company KLM represents 1/3 of the turnover, Air France 2/3. KLM’s share of the profit is 60%. Air France did not have to invest one penny in KLM. Air France was in profit from day one, as it was a pure stock transaction.
I think BA might be a bit sorry they were unwilling to provide the same guarantees to KLM. Their European strategy is unclear (basically they have to acquire Iberia now, or really be left at the margins), and their main hub will see a whole slew of new competitors flying to the USA soon. It’s answer it to piss off its pilots by trying to bypass them while starting a new division to fly from mainland Europe. Terminal four will become an exclusive Skyteam terminal from October, 2008. BA only controls 38% of all slots at Heathrow. Which is about half the percentage that the other large airlines control at their main hubs in Europe.
I am far from certain Air France/KLM will be able to take over Alitalia. The unions might run it into the ground to prevent the takeover. But even that would be better than leaving the subsidized mess that Alitalia has basically always been alive, distorting the aviation landscape.
Last edited by Otterman; 19th Mar 2008 at 08:41.
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Any buyout of KLM required the permission of the Dutch government. BA wasn’t able to obtain it, once again because of what they wanted to do to KLM was not worth the price. The minor adjustment in capacity (mostly across the Atlantic) was not a breaking point. And certainly not any different than what happened during the Air France buyout. Air France/KLM had to reduce capacity between France and Holland, and give up slots at both CDG and AMS to competitors to provide these services.
Air France did not pay a penny for KLM. The transaction was purely a stock deal (valuing KLM at around 840 million Euros). Air France proved themselves to be more visionary than BA (amazing, but true).
So let’s be clear any BA/KLM deal was never opposed by any regulatory agency, because no official deal was ever put forward.
Air France did not pay a penny for KLM. The transaction was purely a stock deal (valuing KLM at around 840 million Euros). Air France proved themselves to be more visionary than BA (amazing, but true).
So let’s be clear any BA/KLM deal was never opposed by any regulatory agency, because no official deal was ever put forward.
Last edited by Otterman; 19th Mar 2008 at 08:43.
Join Date: Sep 2007
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The CEO of AF/KLM announced today that due to the stubborness of the AZ unions the deal is unlikely to go through ( which seems to me the political expression of a walk away). This would be the 2nd airline in Europe ( after Sabena ) killed by irresponsible unions.
Bye Bye Alitalia, I am sure you will not be missed!
Frank
Bye Bye Alitalia, I am sure you will not be missed!
Frank
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Those unions are getting nowhere now.
Alitalia takeover "in jeopardy", Air France-KLM boss says
4 hours ago
ROME (AFP) — A plan by Air France-KLM to take over failing Alitalia is "in jeopardy" after the breakdown of talks with the Italian carrier's unions, the European giant's chairman Jean-Cyril Spinetta said Wednesday.
"It's true the agreement is in jeopardy," Spinetta told the Italian news agency ANSA, adding, however: "I'm still confident."
The Air France-KLM boss was to meet early Wednesday with Alitalia leaders to discuss renewing contact with the unions, whose green light is necessary for the deal to go forward.
Talks on Tuesday with the nine unions were tense and ended in disagreement.
The main unions issued a joint statement saying they had a "very critical judgement" of the talks and argued that the negotiating timetable was unrealistic -- Air France-KLM wants an agreement by the end of March.
While the European giant says it plans to cut 1,600 jobs from the 11,000-strong work force, the unions fear job losses of up to 7,000.
Spinetta reportedly warned on Tuesday that his company could walk away from the deal, accepted Monday by the Italian government.
"We are certainly not obliged to acquire Alitalia," Spinetta said, according to a labour leader who was present at the talks.
Italy's outgoing centre-left government on Monday approved the acquisition of the state's 49.9 percent stake through a share swap of one Air France-KLM share for every 160 Alitalia shares.
That values the Italian airline at 140 million euros (218 million dollars).
Tuesday's talks at Alitalia headquarters began shortly after protesters outside the building clashed with police, leaving one demonstrator slightly injured..
Some 350 demonstrators took part in the protest including employees of AZ Servizi, the maintenance unit that would be shut down under the takeover deal.
A second demonstration was staged at Rome's Fiumicino airport.
Alitalia takeover "in jeopardy", Air France-KLM boss says
4 hours ago
ROME (AFP) — A plan by Air France-KLM to take over failing Alitalia is "in jeopardy" after the breakdown of talks with the Italian carrier's unions, the European giant's chairman Jean-Cyril Spinetta said Wednesday.
"It's true the agreement is in jeopardy," Spinetta told the Italian news agency ANSA, adding, however: "I'm still confident."
The Air France-KLM boss was to meet early Wednesday with Alitalia leaders to discuss renewing contact with the unions, whose green light is necessary for the deal to go forward.
Talks on Tuesday with the nine unions were tense and ended in disagreement.
The main unions issued a joint statement saying they had a "very critical judgement" of the talks and argued that the negotiating timetable was unrealistic -- Air France-KLM wants an agreement by the end of March.
While the European giant says it plans to cut 1,600 jobs from the 11,000-strong work force, the unions fear job losses of up to 7,000.
Spinetta reportedly warned on Tuesday that his company could walk away from the deal, accepted Monday by the Italian government.
"We are certainly not obliged to acquire Alitalia," Spinetta said, according to a labour leader who was present at the talks.
Italy's outgoing centre-left government on Monday approved the acquisition of the state's 49.9 percent stake through a share swap of one Air France-KLM share for every 160 Alitalia shares.
That values the Italian airline at 140 million euros (218 million dollars).
Tuesday's talks at Alitalia headquarters began shortly after protesters outside the building clashed with police, leaving one demonstrator slightly injured..
Some 350 demonstrators took part in the protest including employees of AZ Servizi, the maintenance unit that would be shut down under the takeover deal.
A second demonstration was staged at Rome's Fiumicino airport.
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...do not be so sure that Alitalia is a "goner"... Unions are tough but not stupid...they will find a way out..the painless the better...the situation is made even more complex by the oncoming political elections..being a "flag carrier" Alitalia has always been steered by politicians and now nobody is willing to take the helm..too risky so close to election day (13 apr)...so I guess that will have to wait a bit longer to know if AZ is going to be a sitting duck or a phoenix....
As for the 500 pilots...I do not think they going to be a problem for young students...if they are going to sack me (az Cpt.) I'll look elsewhere for a job not in europe...
As for the 500 pilots...I do not think they going to be a problem for young students...if they are going to sack me (az Cpt.) I'll look elsewhere for a job not in europe...
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This would be the 2nd airline in Europe ( after Sabena ) killed by irresponsible unions.
Bye Bye Alitalia, I am sure you will not be missed!
PZ
The food in either city is fine with me. I'd just rather avoid flying on AZ to get there. The union intransigence is not limited to takeover negotiations. It also affects they way they provide service to their customers. Personally, I've never felt like aything other than an inconvenience to most of them.
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Swissair did not go down because of the unions but, quite the contrary, because of totally inept management.
The strategy of the management was to gain access to the EU market by buying companies finding themselves in deficit/debt and turning them around (was dubbed the hunter strategy). Swissaire arrogance was such that it believed that it could turn a company like Sabena that never made a profit in its entire life in a cash cow in a matter of months.
The strategy of the management was to gain access to the EU market by buying companies finding themselves in deficit/debt and turning them around (was dubbed the hunter strategy). Swissaire arrogance was such that it believed that it could turn a company like Sabena that never made a profit in its entire life in a cash cow in a matter of months.
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Obviously, for AZ to continue to exist, there will have to be some "pain" for the union employees as well as management. The airline is supposed to be a business, not a charity.
If the unions foul up this AF/KL deal, I would classify it as a murder-suicide, with the company being murdered whilst the unions commit suicide.
It seems that they never miss an opportunity to miss an opportunity!
If the unions foul up this AF/KL deal, I would classify it as a murder-suicide, with the company being murdered whilst the unions commit suicide.
It seems that they never miss an opportunity to miss an opportunity!
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Unions are a legalized type of mafia in a way. They won't back up unless you back up.I think it it is a pitty for Italians to sold their flag carrier for 108 millions to French and Dutch. What a waste!
Well,they can not even take care of their garbage down in Napoli so how do you expect them to run a national airline for god's sake?
Just being sarcastic,that's all...
Well,they can not even take care of their garbage down in Napoli so how do you expect them to run a national airline for god's sake?
Just being sarcastic,that's all...
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Bye Bye Alitalia, I am sure you will not be missed!
That'll send a clear message out. One that says "don't employ Italians".
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Media tycoon Silvio Berlusconi has just announced that he will veto the take over of Alitalia by AF/KLM if he wins the elections in April.
Here is the full article.
http://www.hemscott.com/news/latest-...62077309856145
Here is the full article.
http://www.hemscott.com/news/latest-...62077309856145