Air France-KLM Royal Dutch Airlines will acquire a 31% stake in Virgin Atlantic (VS, London Heathrow) from Virgin Group, the UK-based firm said in a statement issued on Thursday, July 27.
Under the transaction, valued at GBP220 million (USD287.6 million), Virgin Group's shareholding in the carrier will decrease to 20%. Delta Air Lines (DL, Atlanta Hartsfield Jackson) will retain its 49% stake, acquired in 2013.
Despite the purchase, Virgin Atlantic says it will retain its independence as a UK airline with a UK operating certificate and will continue to fly under the Virgin brand.
In tandem with this announcement, Delta has confirmed its acquisition of a 10% stake in the Franco-Dutch carrier for EUR375 million (USD437.1 million). The US carrier said in a separate statement the purchase would give it a seat on Air France-KLM's board.
With the equity buy-ins complete, Air France-KLM and Delta will expand their transatlantic joint-venture to include Virgin Atlantic. The partnership was established in 2009 with Alitalia (AZA, Rome Fiumicino) joining in 2010.
"The enhanced joint venture, including Alitalia, would become the airline partnership of choice for customers, offering more than 300 daily nonstop transatlantic flights and increasing competitive routings with offerings across key business markets including Amsterdam Schiphol, Atlanta Hartsfield Jackson, Boston, Cincinnati International, Detroit Metropolitan, Los Angeles International, London Heathrow, Minneapolis St. Paul International, New York JFK, Paris CDG, Salt Lake City, and Seattle Tacoma International," the statement added.
All transactions are subject to execution of definitive agreements and receipt of final shareholder, board, and regulatory approvals.
