KLM HAS WITHDRAWN its three senior executives from the board of Northwest Airlines in a further twist to the boardroom bust-up between the two alliance partners.
KLM's president Pieter Bouw, managing director Leo van Wijk and chief financial officer Rob Abrahamsen have resigned their places on the Northwest board. KLM will instead appoint independent board members to oversee the Dutch groups 19% voting interest in Northwest.
The resignations are being presented by KLM as a conciliatory move, designed to ease relations between the two carriers. In particular they address Northwest's fears that KLM represents a "creeping control threat".
KLM says that the three executives could not "...unify their responsibilities" as directors of both airlines. Northwest also welcomes the decision as a positive move.
Cracks in the alliance partnership broke into a highly public dispute in November, when the Northwest board voted to adopt a "poison-pill" measure to prevent KLM gaining any further control. In reply, KLM argued that its shareholder rights were being curbed and filed a legal action against its partner.
Among the US airline's complaints were charges that Bouw had used his board presence to pursue KLM interests at the expense of those of Northwest.
Despite the strained relationship, both partners, stress that the alliance has been highly successful, at an operational level, and neither seems prepared to jeopardise the flow of profits from the co-operation.
In the first nine months of its financial year to the end of December, KLM includes income of DFl166 million ($100 million) from its holding in the now highly profitable Northwest.
KLM had written down the holding during Northwest's financial troubles, but is now writing it back as the shares soar in value. KLM's overall net earnings for the first nine months stood at DFl528 million.
Source: Flight International
