Shipping group CMA CGM to take Air France-KLM stake under cargo tie-up

CMA CGM, the French shipping group, is set to become a leading shareholder in Air France-KLM and will forge a partnership in air cargo with the carrier, part of a drive to expand its reach after a boom in its business during the pandemic. The Marseille-based container company, which in recent months has made investments in logistics ventures, port terminals and a parcel delivery group at a time when international shipping prices have been soaring, will take up to 9% of the airline group, the companies said. The deal will make CMA CGM a top investor in Air France-KLM, which is partly backed by the French and Dutch governments, as the airline emerges from a rocky patch following coronavirus lockdowns that brought most travel to a halt and pushed the company to request bailouts. The shipping group’s position as a shareholder will depend on the outcome of a looming E4b capital raising at Air France-KLM, and on whether state investors or shareholders such Delta of the US and China Eastern Airlines take part. A partnership would also set a precedent in the cargo world in which players, including some of CMA CGM’s shipping rivals, have begun to encroach on the airfreight market. “We think we can be innovators. The existing air-cargo market has not been very innovative for the last 30 to 40 years. The model has been quite stagnant,” said Ben Smith, Air France-KLM chief. The 10-year agreement, which will allow the companies to pool their networks and cross-sell their freight capacity, will help bump up revenues and offer broader services to existing clients, many of which are shared with CMA CGM, Smith added.<br/>