The Hague - KLM Royal Dutch airlines and Alitalia, Italy`s national carrier, planned to extend their alliance into a full merger, Leo Van Wijk, the chief executive of KLM, said yesterday.
KLM could take an equity stake in Alitalia once the Italian government sold its 53 percent stake, Van Wijk said. KLM is also partially government owned.
Van Wijk said the companies had received approval for a merger from European regulatory authorities in August, when they were given the go-ahead for their alliance.
"We weren`t just applying for an alliance. We applied for a merger," Van Wijk said. "We don`t have to go back (to the European Commission) to implement what we are aiming for, which is a full merger."
Plans to merge the management into a single board headed by a chairman and a chief executive were revealed earlier this year. The airlines did not say then whether they intended to swap stock or fuse operations to form one company.
It was unclear if Alitalia would also seek to take a stake in KLM or if the Dutch airline would gain a majority holding in the merged company.
Analysts have called the alliance a virtual merger, and Van Wijk`s comments confirm this.
KLM`s stock responded positively to the news, rising over 2 percent on the Amsterdam Stock Exchange just after it was announced. KLM shares were up 1,7 percent at e24,45 (R154,16).