The airline group, to which the Covid-19 has caused the loss of some 11 billion euros since 2020, wants to allocate the majority of the amounts raised to the reimbursement of exceptional aid granted by the French State.

The latter and the Netherlands intend to subscribe to this capital increase in order to maintain the same levels of participation, i.e. 28.6% and 9.3% respectively, resulting in amounts of some 645 and 220 million euros.

The Dutch Parliament will have to give the green light to this latest extension.

On the other hand, the two other main current shareholders, the Chinese companies China Eastern and the American Delta Air Lines, will see their stake reduced in favor of a new entrant, CMA CGM.

The French shipowner and logistics company will invest up to 400 million euros and will become the group's third largest shareholder with 9% if the operation, starting on Wednesday and running until June 9, goes as planned.

China Eastern will in this case drop from 9.6% to 4.7% of the capital, and Delta from 5.8% to 2.9%.

The principle of the entry of the CEO of CMA CGM Rodolphe Saadé to the Board of Directors of the Franco-Dutch group was ratified Tuesday afternoon by the shareholders, gathered in general meeting near Roissy airport north of Paris.

As a logical consequence of the planned issue of new shares, the Air France-KLM share lost 20.63% on the Paris Stock Exchange on Tuesday in the latest trade, in a market down 1.66%.

For Christophe Dewatine, CFDT-Air France Secretary General, the operation "comes at the right time".

"It's rather good news with a good surprise, it's to see the Dutch state enter the project without batting an eyelid," he told AFP.

This is the second stage of the measures taken to clean up the group's finances, after a first recapitalization in April 2021.

In addition to a doubling of its participation, the French government had then agreed to convert into perpetual bonds an aid of three billion euros granted from the spring of 2020.

The CEO of the Air France-KLM group, Benjamin Smith, during the general meeting of shareholders in Tremblay-en-France, near Roissy airport, May 24, 2022 Eric PIERMONT AFP

This aid had received the green light from the European Commission, as part of the exceptional measures taken in the face of the health crisis.

– Accusations of “greenwashing” –

But the institution had forced Air France-KLM to make concessions, including the abandonment of airport slots and the ban on making strategic acquisitions beyond 10% of the capital of the companies concerned as long as State aid n will not have been reimbursed at least 75%.

Air France-KLM wishes to “free itself” from this last constraint in particular, while many opportunities are emerging in the post-crisis period, including the new transalpine company ITA, also coveted by the Lufthansa/MSC tandem.

The group "will allocate approximately 1.7 billion euros" of the amount it hopes to raise to the repayment of the bonds subscribed by the State, while "the balance will reduce the net debt", which was 7.7 billion euros at the end of March.

Air France-KLM had already announced on Friday that it wanted to allocate to the reimbursement of French aid the 500 million euros that the American fund Apollo will invest in a subsidiary that owns a fleet of spare engines.

"As the recovery is confirmed and our economic performance is recovering", Air France-KLM wants to be able to "seize any opportunity in an airline sector in transformation", commented the group's general manager, Benjamin Smith, quoted in the press release. .

After dividing its net loss by three over one year in the first quarter, Air France-KLM expressed its optimism for the summer season, despite the consequences of the war in Ukraine: activity levels for the crucial summer period should approach those of 2019 and even exceed them for the "low cost" subsidiary Transavia.

According to its leaders, the group has emerged intrinsically more profitable from the crisis after having carried out an all-out cost reduction plan for two years, including the elimination of 14,000 jobs.

The general assembly, during which all the resolutions were adopted, was marked by two questions from activists in the fight against global warming, accusing KLM of "greenwashing" in its advertising communication and threatening the company with legal action in the Netherlands. Low.

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© 2022 AFP