Argentina's Senate approves airline takeover
Argentina's Senate approved the nationalization of Aerolineas Argentinas and its subsidiary on Wednesday, moving to return the financially troubled Spanish-owned airlines to state hands.
By Agencies |
BUENOS AIRES-ARGENTINA: Argentina's Senate approved the nationalization of Aerolineas Argentinas and its subsidiary on Wednesday, moving to return the financially troubled Spanish-owned airlines to state hands.
The 46-21 vote in favor of the takeover of Aerolineas Argentinas and Austral airlines was the final step in making the nationalization law. Argentina's lower house in August approved the measure, which requires the state hold a majority of company shares.
The text approved by the lawmakers states that Argentina ``will proceed in the rescue'' of the airline to guarantee commercial air transportation to the public. Congress will now set the purchasing price for the airlines. Aerolineas Argentinas has been in Spanish hands for nearly two decades. Since 2001, the airline has been owned by Spanish travel conglomerate Grupo Marsans.
The company is struggling with financial woes and labor conflicts, and has an estimated US$900 million debt. People celebrated in the streets of Buenos Aires on hearing of the vote, many holding inflatable planes.
But the opposition - which had proposed the airline stay in Spanish hands until the company pays off its debt - said the takeover does not guarantee that the government will not have to take on the company's liabilities.
``There are some who would not permit the payment of a single cent for Aerolineas Argentinas,'' senator Ernesto Ricardo Sanz told opposition radio Union Civic Radial. Aerolineas Argentinas and Austral together account for about 85 per cent of domestic air traffic.
The 46-21 vote in favor of the takeover of Aerolineas Argentinas and Austral airlines was the final step in making the nationalization law. Argentina's lower house in August approved the measure, which requires the state hold a majority of company shares.
The text approved by the lawmakers states that Argentina ``will proceed in the rescue'' of the airline to guarantee commercial air transportation to the public. Congress will now set the purchasing price for the airlines. Aerolineas Argentinas has been in Spanish hands for nearly two decades. Since 2001, the airline has been owned by Spanish travel conglomerate Grupo Marsans.
The company is struggling with financial woes and labor conflicts, and has an estimated US$900 million debt. People celebrated in the streets of Buenos Aires on hearing of the vote, many holding inflatable planes.
But the opposition - which had proposed the airline stay in Spanish hands until the company pays off its debt - said the takeover does not guarantee that the government will not have to take on the company's liabilities.
``There are some who would not permit the payment of a single cent for Aerolineas Argentinas,'' senator Ernesto Ricardo Sanz told opposition radio Union Civic Radial. Aerolineas Argentinas and Austral together account for about 85 per cent of domestic air traffic.
Download
The Economic Times Business News App for the Latest News in Business, Sensex, Stock Market Updates & More.
The Economic Times Business News App for the Latest News in Business, Sensex, Stock Market Updates & More.
Download
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
ADVERTISEMENT
