Nationalization AF-KLM possible, independence of KLM under discussion

Air France-KLM, like the entire aviation sector, was hit hard by the corona crisis this year. Only thanks to billion-dollar support from the French and Dutch governments could the airline keep its head above water.

Share issue

In addition to hundreds of millions of wages subsidy via the NOW scheme, KLM received EUR 3.4 billion in emergency loans and guarantees from the Dutch government. Air France received similar support from the French government.


Due to the high risk of bankruptcy, investors are expected to make little or no investment in the new shares issued by the company. These pieces must therefore be bought by the authorities. This will dilute the interest of the other shareholders.

Moreover, it is expected that this dilution will be enormous. After all, the value of the Air France-KLM share has plummeted due to the corona crisis. At the beginning of this year, the share was still traveling around 9 euros. There is currently about 3 euros left.


In order to raise a substantial amount, the company will therefore have to issue a relatively large number of shares. The percentage stake of the current shareholders who are not buying new pieces can thus be wiped out.

If the French and Dutch governments together acquire a convincing majority interest, they also gain control over the company. In fact, Air France-KLM will be nationalized. Compare it with the government’s interest in ABN Amro, which is still 56 percent despite the IPO in 2015.

KLM independent

State Secretary Djebbari yesterday acknowledged that a ‘technical nationalization’ is possible through the issue of shares. He also stated that the integration of KLM into Air France is ‘on the agenda’.

According to De Telegraaf, the unrest within KLM has thus returned, after turbulent weeks surrounding the austerity in terms of employment and the previous support package.

Minister of Finance Wopke Hoekstra tells the newspaper that it is still uncertain whether the Dutch government will participate in a share issue. He is not positive about the further integration of KLM into Air France. “It’s not a foregone conclusion whether things will get better with more integration. It’s not something I’m immediately thrilled with.”

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