KLM will have to go it alone to win back investor confidence - claim

Airline Industry Information, Sept 25, 2000

AIRLINE INDUSTRY INFORMATION-(C)1997-2000 M2 COMMUNICATIONS LTD

Aviation industry analysts have said that KLM Royal Dutch Airlines (KLM) needs to focus on its own operations for a while after merger talks with British Airways collapsed late on 21 September.

The breakdown in merger talks is the second in six months for KLM and the carrier is expected to pursue another long-term partnership in the future, but should work towards rebuilding investor confidence in the short term according to an analyst with Fortis. An analyst at ING Barings also indicated that KLM will have to look at partnerships in the long term and may even have to return to negotiations with Alitalia once the problems with Malpensa airport are resolved.

KLM was previously in merger negotiations with the Italian airline until April this year.

The merger with British Airlines is believed to have failed due to demands by KLM and the Dutch government that KLM retain control over parts of its own operations according to Dow Jones Newswires.

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