Air France-KLM to end cargo arrangement with logistics firm CMA CGM

French airline holding company Air France-KLM Group plans to end its air cargo deal with French shipping and logistics firm CMA CGM, the airline announced on Tuesday.

Shares in Air France-KLM Group were losing around 3% in early morning trading in France after the airline announced its decision to withdraw from its existing air cargo agreements with CMA CGM from March 31.

CMA CGM, which remains a core shareholder in Air France-KLM, will also step down from the Air France-KLM board of directors on the same date, it said.

The cargo commercial cooperation between both companies, which was announced in May 2022, became effective in April 2023. However, the companies now noted that the tight regulatory environment in certain important markets has prevented the cooperation from working in an optimal way.

Air France-KLM and CMA CGM said they have begun discussions on new terms and conditions of a commercial relation to operate independently from March 31 onwards.

The companies have agreed to amend the existing lock-up on CMA CGM shares in Air France-KLM's capital, which will now be effective until February 28, 2025.

According to the company, the initial lock-up undertaking of CMA CGM is modified to provide that the initial lock-up period ends on February 28, 2025, without any subsequent lock-up period.

The initial lock-up on all Air France-KLM shares subscribed by CMA CGM in the rights issues announced on May 24, 2022, expires on June 15, 2025, and subsequent lock-up period on 50% of such shares expires on June 15, 2028.

In France, Air France KLM shares were trading at €11.73 ($12.77), down 2.51%.