Why Are Air France-KLM Shareholders So Scared Of The Dutch Government?

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Shares in Air France-KLM plummeted by as much as 15% today after the Dutch government’s surprise decision to buy a sizable chunk of the airline group

Air France merged with KLM in 2004, but the two flag carriers have retained their own brands, management structures and corporate cultures.Shares in Air France-KLM plummeted by as much as 15% this morning after the Dutch government’s surprise decision to buy a sizable chunk of the airline group.

The Dutch state already held a 5.9% stake in KLM, but lagged behind France for control at group level. The Hague is planning to lift its stake further in the coming weeks to match Paris’s 14.3% shareholding. Air France's lower profitability and recurring industrial disputes have been further bones of contention.

 

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