Air France-KLM strengthens strategic partnerships, buys stake in Virgin Alantic

Air France-KLM has announced a further major step in the reinforcement of its strategic partnerships with the creation of a single global joint-venture between Air France-KLM, Delta Air Lines and Virgin Atlantic and the strengthening of its partnership with China Eastern Airlines. Air France-KLM will acquire Virgin Group’s 31% stake in Virgin Atlantic for £220m and Delta and China Eastern will each acquire a 10% stake in Air France-KLM within the framework of reserved capital increases totalling €751m. All of these agreements will enable Air France-KLM to offer its customers an expanded network and to capitalize on the pooling of extensive distribution networks. As an integral part of the Trust Together strategic project, these partnerships will support the Group’s profitable growth and enable Air France-KLM to offer its customers an unparalleled proposition. The creation of this joint-venture will thus consolidate Air France-KLM’s leadership position in the North-American and European markets with the largest airline network articulated around twelve powerful hubs on both sides of the Atlantic: Amsterdam, Atlanta, Boston, Cincinnati, Detroit, Los Angeles, London Heathrow, Minneapolis-St Paul, New York-JFK, Paris-CDG, Salt Lake City and Seattle.
In parallel, Air France-KLM and China Eastern will step up their commercial cooperation and reinforce their partnership within the framework of the existing joint venture. These capital increases will enable an improvement in Air France-KLM’s financial structure, accelerate the reduction in its net debt and finance the purchase of the stake in Virgin Atlantic.