European Commission gives approval to Air France-KLM investment in Virgin Atlantic

European Commission gives approval to Air France-KLM investment in Virgin Atlantic

The European Commission has approved the acquisition of joint control over Virgin Atlantic by Air France-KLM, Delta Air Lines and Virgin Group.

The deal is valued at around £220 million and is part of an expanded transatlantic joint venture between Delta and the European carriers.

The commission concluded the transaction would raise no competition concerns in the European Economic Area.

The decision concerns the proposed acquisition by Air France-KLM of a 31 per cent joint-controlling interest in Virgin Atlantic.

Virgin Group will retain a 20 per cent stake and chairmanship of the UK long-haul carrier founded by Richard Branson.

At the same time, Delta will retain its 49 per cent shareholding.

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The commission cleared the deal after it found no reduction in competition in the markets for the transport of passengers or cargo, as well as maintenance, repair and overhaul services.

The EU body previously approved the acquisition of joint control of Virgin Atlantic by Delta and Virgin Group in 2013.

At the same time, Air France-KLM, Delta and Virgin Group intend to enhance the scope of their existing cooperation in the provision of air transport services for passengers and cargo by combining and expanding two pre-existing “metal neutral” joint venture arrangements between Delta and Air France-KLM, and between Delta and Virgin Atlantic.

These are cooperative arrangements in which they jointly plan and manage capacity, pricing, and inter-airline financial settlements, with all participating airlines sharing profits equally.

The formal statement from the European Commission can be seen here.