PARIS – Air France-KLM has announced a long-term air cargo partnership with French CMA CGM Group, which will become a new core shareholder of the Franco-Dutch airline, and will ship shares in the Franco-Dutch airline in early morning trading.
CMA CGM will acquire up to 9% of Air France-KLM’s share capital, following Air France KLM’s planned capital increase, for the duration of their exclusive partnership, which will initially run for 10 years, the two companies said.
The collaboration is subject to approval by the competition authorities.
Air France-KLM was up about 3% in the early trading session, making the stock one of the top-performing stocks on the Paris SBF-120 stock index.
The partnership is expected to generate “significant revenue synergies,” the companies added.
The partnership between the two companies follows a rebound in freight markets amid the COVID-19 pandemic, and comes as carriers seek to shield against any future downturn and take steps to make global supply chains more resilient.
“This partnership is fully in line with CMA CGM’s strategy and ambition to become a leader in integrated logistics for the benefit of its customers. Our interest in the company means that Air France-KLM can count on us to support its future development,” said Rodolphe Saadé, Chairman and CEO of CMA CGM.
The partnership includes a combined fleet of 10 full-cargo aircraft, including four from CMA CGM Air Cargo and six from Air France-KLM, with a combined 12 aircraft also on order.
It also covers the capacity of Air France-KLM’s belly aircraft, including more than 160 long-haul passenger aircraft.
Air France-KLM competes with European airlines, including Lufthansa and freight specialist Cargolux, as well as major Gulf and Asian airlines in the air cargo market.
According to International Air Transport Association statistics, the individual networks of Air France, KLM and Martinair together rank about 8th in the global ranking of cargo airlines.
Air France-KLM’s major shareholders, including the French and Dutch governments, will support CMA CGM in securing a board seat at the company’s next board meeting on May 24, the companies added. (Reporting by Tim Hepher; editing by Sudip Kar-Gupta)
This post CMA CGM takes stake in Air France KLM as part of new freight partnership was original published at “https://financialpost.com/pmn/business-pmn/cma-cgm-to-take-stake-in-air-france-klm-as-part-of-new-cargo-partnership-2”