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Reuters

Tim Hepher and Gus Trompiz

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PARIS — French transport agency CMA CGM will take a stake in Air France-KLM as a part of an air cargo partnership, betting on rising demand for flying items world wide as provide chains stay snarled within the wake of the pandemic.

CMA CGM will take as much as 9% of Air France-KLM, a part of a doable capital improve by the airline group, at some point of their partnership that’s initially set to run for 10 years, the 2 firms stated.

It can make CMA CGM the fourth greatest shareholder, in line with Refinitiv knowledge, and mirrors the same initiative deliberate by transport firm MSC, which has teamed up with Germany’s Lufthansa on a possible bid for Italian airline ITA.

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Air France-KLM shares rose about 3% in early commerce, making it a prime performer on the Paris SBF-120 fairness index.

Marseille-based CMA CGM, one of many world’s largest container transport traces, established an air cargo division final yr as a part of a push to develop non-maritime logistics.

Surging income for ocean transport, linked to excessive freight charges because the COVID-19 pandemic, have allowed CMA CGM and different shippers to put money into different types of transport so as to add resilience to international provide chains and shield in opposition to a downturn.

CMA CGM, privately managed by the Saade household, acquired auto transport firm Gefco final month that had been co-owned by Russian Railways (RZD) and carmaker Stellantis.

Air France-KLM and CMA CGM stated their partnership was anticipated to generate “vital income synergies” and stated they’d a “robust ambition to speculate and develop sustainably” within the air freight market.

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The partnership with Air France-KLM covers a mixed fleet of 10 full-freighter plane together with 4 at CMA CGM Air Cargo and 6 at Air France-KLM. Collectively, in addition they have 12 plane on order.

It additionally covers Air France-KLM’s stomach plane capability, overlaying freight carried within the airline group’s greater than 160 long-haul passenger plane.

Air France-KLM competes within the cargo market with European carriers together with Lufthansa and freight specialist Cargolux, in addition to main Gulf and Asian carriers.

The separate networks of Air France, KLM and Martinair – a subsidiary of the group – rank the group round eighth within the international league desk of cargo airways by site visitors, in line with Worldwide Air Transport Affiliation statistics.

Air France-KLM’s principal shareholders, which embody the French and Dutch governments, supported CMA CGM gaining a board seat on the firm’s subsequent board assembly on Could 24, the companions stated.

The tie-up is topic to anti-trust approval. (Reporting by Tim Hepher; Enhancing by Josephine Mason and Edmund Blair)

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