Having shied away from entering the bidding process for flag-carrier Olympic Airways, two of Greece's main private carriers - Aegean Airlines and Cronus Airlines - have announced they are to merge their operations.
The merger has been on the cards since the two airlines started co-operating on domestic routes last year and will create an effective "second force" airline. With more than 40% of the domestic market, nearly three million passengers, revenues of around c150 million ($135 million), and a fleet of 15 aircraft, the combined carrier is well positioned to create the economies of scale necessary to survive in a volatile and government-dominated market. Approval for the merger will be required from the Competition Commission of the Greek Ministry of Commerce.
The combined airline has the backing of some of the country's most powerful shipping, industrial and financial interests. Shareholders will include the Vassilakis Group, the Laskarides Group, Minoan Lines, Piraeus Bank Venture Capital and three private individuals. Present shareholders of Aegean Airlines will control 77.5% of the new company, with the owners of Cronus holding the remaining 22.5%. These percentages are proportional to the invested capital. Theodore Vassilakis, who gives his name to the lead group, will become president.
The two companies will continue to operate with both brands for the time being, with Cronus concentrating on developing its European scheduled and charter services, and Aegean focusing on the domestic market. The present networks serve 11 destinations within Greece and eight in Europe, the latter including major cities in France, Germany, Italy and the UK. The fleet is made up of four Boeing 737-300s, two 737-400s, six Avro RJ100s, and three ATR72-200 turboprops.
Source: Airline Business
