views

Air France and Delta to merge

AIR FRANCE-KLM, Europe&rsquo;s biggest airline, yesterday announced it had finalised a deal with US airline Delta to operate as one airline over the Atlantic, boosting its share of the world&rsquo;s busiest route to 25 per cent.<br /><br />The news came as the French carrier reported full-year losses of &1119;578m (&pound;507m) yesterday, down from a profit of &1119;790m last year, in the latest blow to the ailing industry.<br /><br />But the losses beat expectations. Analysts had forecast losses of around &1119;902m.<br /><br />The profit-sharing venture between the two largest airlines on each side of the ocean had been long expected and pushed shares in Air France up, closing at &1119;11.30, an 11.44 per cent lift.<br /><br />The tie-up between Delta &ndash; the world&rsquo;s biggest airline by passenger traffic &ndash; and Air France-KLM has won anti-trust clearance from the US Department of Transport (DoT).<br /><br />It means the companies will share revenues and costs on 200 transatlantic flights.<br /><br />Air France and KLM merged in 2004 and Delta bought Northwest &ndash; an airline which KLM had a tie-up with &ndash; last year, paving the way for a four-way partnership.<br /><br />&ldquo;Our employees will benefit because being part of a strong vibrant airline is ultimately good for them,&rdquo; Delta chief executive Richard Anderson said, seeking to reassure his 80,000 staff over the Air France-KLM/Delta tie-up.<br /><br />The news follows a furore over British Airways&rsquo; &nbsp;proposed tie-up with American Airlines, which also needs antitrust immunity clearance. BA also wants a partnership with Spanish flag carrier Iberia. Earlier this week, Virgin Atlantic boss Richard Branson hit out at BA&rsquo;s plans.&nbsp;