AIR FRANCE-KLM is expected to stop Alitalia's cargo operations in the event its US$215 million takeover bid for the cash-strapped Italian airline goes ahead, pending Italian government and union approval.
State-controlled Alitalia has accepted the offer, which comes at an 80-per cent discount to its share price last Friday, a report by New York's Journal of Commerce said. It noted that the Italian state owns 49.9 per cent of Alitalia and has been looking for a buyer for over a year.
The closure of Alitalia's cargo operations would be part of a restructuring drive intended to help the airline turn an operating profit in 2011 for the first time since 1998. Also on the table are plans to reduce the size of its passenger fleet from 185 to 137 aircraft.
The cargo unit, which operates five MD-11 freighters, suffered a 3.8 per cent drop in cargo volume in January compared to the previous year as the carrier reduced its freight capacity by 7.6 per cent.
Alitalia's woes are said to have been compounded by the desire of many shippers to transport freight by truck to Zurich and Frankfurt, the hubs of SwissCargo and Lufthansa Cargo.
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