20-Aug-2009 10:16 AM

Air France-KLM withdraws from the Czech Airlines privatisation; privatisation to proceed

Air France-KLM informed (19-Aug-09) the Czech Ministry of Finance of its decision to withdraw from the tender process for the privatisation of Czech Airlines (CSA).  Czech Airlines stated it "understands and respects" the reasons underlying Air France-KLM’s withdrawal, adding that it is "prepared to continue cooperating with Air France-KLM in the SkyTeam Alliance". [more - Czech Airlines] [more - Air France-KLM]

The Czech Government, meanwhile, stated it would “continue in the tender and is not changing its proceedings”, despite only having a single bidder, a consortium of Czech companies, Unimex and Travel Service (Reuters, 19-Aug-09). It extended the deadline for the consortium's bid by 15 days until 30-Sep-2009, after which it will submit the sale decision to the caretaker Government, just weeks before the Oct-2009 election. The Czech Finance Ministry in Apr-2009 selected Air France-KLM and the Czech consortium as second-round bidders for the carrier, rejecting bids from Aeroflot and Odien. It was previously expected the airline would be sold for up to USD276 million.

Air France-KLM: "The current economic environment has significantly impacted the airline business. Under such circumstances, Air France-KLM believes that CSA might focus on developing and implementing a stand-alone recovery plan aimed at restoring its profitability. In this context Air France-KLM wishes to further strengthen the existing partnership between the two groups and to continue to explore with CSA any new areas of cooperation that could be of mutual benefit to each company," Company Statement, 19-Aug-09.

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