Air France set to sell Irish-based CityJet to German firm
Corporate rescuer will take control of loss-making airline
AIR France-KLM is understood to be close to an agreement to sell its Irish-based CityJet unit to a German corporate rescue firm.
Dublin-headquartered CityJet has been up for sale since September last year and initially attracted approaches from around 20 potential buyers. Air France took full control of CityJet in 2000.
Some 280 of the airlines 800 staff are based in Ireland, at the company headquarters in Dublin.
It is understood that Germany-based 'turnaround specialists Intro Aviation is in exclusive talks with the owners to buy the business, but negotiations are not yet complete.
One of Intro's specialities is buying loss-making airlines, restructuring them and selling them on.
It bought Germany's Deutsche BA from BA in 2003 for just €1 and sold the company to Air Berlin three years later. In 2006 Intro bought a controlling stake in a second German airline LTU Group in 2006 and sold it to Air Berlin in 2007.
CityJet operates 20 regional routes including between Dublin and London's City Airport close to Canary Wharf.
A sale is not expected to have any implications for the location of the airline's headquarters in Ireland.
The original long-list of potential buyers was whittled down to two last April when ASL Aviation, which is based in Ireland, and Intro Aviation emerged as frontrunners.
Just one bidder is now in contention. A final decision on whether the sale to Intro Aviation will go ahead is expected to be made within weeks.
CityJet recorded losses of €8.8m in the nine months to the end of December 2011, according to accounts filed with the Companies Office.
Turnover was €238m for the period.
The most recently reported losses were well down on a €55m loss recorded over the previous 12-month period, which ended on March 21 2011.
CityJet operates 20 European routes selected to serve the business community.
It is the biggest user of London's City Airport, popular with bankers and brokers because it is the closest airport to the city's financial districts.