Air France delays Meridien sale

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The Independent Online
Forte's bid for a controlling stake in the Meridien hotel chain yesterday became entangled in French politics, which could reduce its chances of success against a rival offer from Accor.

Air France, which owns 57.3 per cent of Meridien, has deferred a decision on the sale to take advice from the French government's privatisation committee.

The state-controlled airline also confirmed it had lost a net Fr8.48bn ( pounds 982m) in 1993. 'This was the blackest year ever for Air France,' a spokesman said.

The Meridien announcement came after the Air France board discussed a study on the economic, financial, legal and industrial aspects of the bids.

Industry sources said the airline had been unable to decide which to accept, and was seeking government guidance.

A leisure analyst said the danger for Forte was that a long delay would see the bids subjected to increased political scrutiny.

'It is difficult to read too much into this. But ostensibly the decision looks to be against Forte and in favour of Accor,' he added.

Accor, the French hotels group, has tabled a joint pounds 65m offer for a 40 per cent stake in Meridien with Prince Al Waleed, nephew of King Fahd of Saudi Arabia.

The bid by Forte, one of Britain's biggest hotel groups, is understood to value Meridien at pounds 210m. Richard Power, communications director at Forte, said: 'We still think we have a good chance.'

Air France's losses in 1993 were two-and-a-half times the Fr3.27bn decline the year before. The 1993 result included a Fr1.8bn restructuring provision. Bernard Attali, former chairman, was singled out as being responsible for the industrial action at Air France following his restructuring proposals last year.

Delta Air Lines, the carrier based in Atlanta, Georgia, said that it would shed between 12,000 and 15,000 jobs as part of a restructuring aimed at lowering annual operating costs by approximately dollars 2bn by the June quarter of 1997.

Three out of four of the reductions are expected to be in place by the end of June 1995.

The company said the restructuring programme did not include the formation of a separate low-fare airline.

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