Table of Contents
Introduction 2
Method 2
Chapters 3
1. Air France-KLM 3
2. ALITALIA 6
3. Strategic analysis of the posible merger 8
4. Financial evaluation of the acquisition 9
Conclusion 11
Perspectivations 11
Sources 12
Financial Statements 13
Introduction
For this ten pages project we have focused our study on two firms members of the airline industry : the French and Dutch company Air France-KLM and the Italian company Alitalia.
First, We have chosen those two companies because they have established a strong relationship for severals years. Indeed, first in 2002, a joint venture was operated between Air France and Alitalia with a focus on the Italy – France air routes. Moreover, we have chosen those two companies because they represent today a big issue in the world financial news. Indeed, on the one hand, Air France-KLM has increased its profits strongly in the first half and forecast higher earnings for the full year supported by continuing strong demand for air travel. On the other hand Alitalia profits are falling and his debt increases in front of his competitors. Thus, the French-Dutch airline said on Thursday November 22th it was considering possible takeover moves for Alitalia, the heavily loss-making Italian carrier.
Within this framework severals questions are appearing : Can Air France-KLM handle to buy the chronically sick Italian company ? What might be the boundaries for Alitalia, a company owned by a 49% by the Italian treasure ?
We will first examine Air France-KLM and Alitalia financial situations. Then, we will present a strategical analysis of the synergy between the two companies. Finally, we will discuss the worst and best case scenarios.
Method
We ...