Air France Gets Intro Bid for London City Arm in Regional Revamp
Dec. 20 (Bloomberg) --- Air France-KLM Group (AF) received a firm offer for unprofitable regional operator CityJet from German turnaround specialist Intro Aviation GmbH as Europe’s biggest airline seeks to streamline short-haul operations.
The planned sale of the No. 1 carrier at London City airport should close in the first quarter of 2014, Paris-based Air France said in a statement today. The offer price for a deal that includes VLM Airlines of Belgium was not disclosed.
The transaction will include an agreement “for ongoing commercial co-operation,” between the companies, Air France said, adding that labor groups will be consulted.
Air France offered CityJet for sale in September 2012 as part of a revamp aimed at ending European losses. Intro, founded by retail entrepreneur Hans-Rudolf Woehrl, is taking on a carrier with a fleet of 38 BAE Systems Plc Avro RJ85 jets and Fokker 50 turboprops able to serve London City’s short runway.
In preparation for a change of ownership, CityJet had already begun operating its own revenue system, Chief Executive Officer Christine Ourmieres said in an interview last month.
Intro, was founded in 1973 by Woehrl, who ran Nuremburg-based NFD before selling the carrier to Eurowings in 1992, according to the Reichenschwand-based company’s website.
Woehrl became CEO of Deutsche BA in 2003 after buying the unit for 1 euro from British Airways, which had hired him to shut it down. The operation was refocused on the high-frequency business travel market and sold to Air Berlin Plc in 2006.
CityJet, which has its offices in Dublin, had a 6.2 million-euro ($8.5 million) operating loss for the nine months through December 2011 on sales of 238 million euros, according to its most recent filing with the Irish companies office.
Air France-KLM, which closed 0.9 percent higher before the announcement, does not break down CityJet’s figures in its interim or annual reports.
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