- CMA CGM, a French shipping company, invests in Air France-KLM (OTC:AFLYY) as part of an air cargo partnership, counting on growing demands for flying goods worldwide while supply chains remain snarled in the aftermath of the pandemic, Reuters reported.
- CMA CGM will take up to 9% of Air France-KLM, worth ~€240 million ($252 million) based on the closing price on May 17, 2022, as part of a possible capital increase by the airline group for the duration of their partnership, which is initially set to last ten years.
- CMA CGM established an air cargo division last year as part of a push to develop non-maritime logistics.
- Profits for ocean shipping have risen due to high freight rates since the COVID-19 epidemic, allowing CMA CGM and other shippers to invest in alternative modes of transportation to strengthen global supply chains and protect against a downturn.
- Air France-KLM and CMA CGM stated that their collaboration would result in "substantial revenue synergies" and had a "strong intention to invest and grow sustainably" in the air freight industry. They will also combine their global sales forces.
- The collaboration with Air France-KLM encompasses a combined fleet of ten full-freighter aircraft, four at CMA CGM Air Cargo and six at Air France-KLM. They have a total of 12 aircraft on order.
- Price Action: AFLYY shares closed higher by 3.22% at $4.17 on Tuesday.
- Photo via Wikimedia Commons
