=20 ---------------------------------------------------------------------- This article was sent to you by someone who found it on SF Gate. The original article can be found on SFGate.com here: http://www.sfgate.com/cgi-bin/article.cgi?file=3D/news/archive/2003/02/06/f= inancial1135EST0084.DTL ---------------------------------------------------------------------- Thursday, February 6, 2003 (AP) Air Lib flights grounded after Dutch holding company withdraws from efforts= to save troubled carrier JEAN-MARIE GODARD, Associated Press Writer (02-06) 11:28 PST PARIS (AP) -- Air Lib, France's second-largest airline, lost its operating license Thursday and was forced to ground its fleet after negotiations with a Dutch concern to save the carrier fell through. Transport Minister Gilles de Robien said the government "deplored" that = an agreement could not be reached with IMCA Group, whose interests include shipping and property and is a partner with Dutch carrier KLM Royal. The ministry said the government would do everything in its power to find jobs for the carrier's 3,200 employees, several hundred of whom protested at Paris' Orly airport Thursday. Police blocked protesters who tried to get onto airport runways. De Robien said Air Lib's fate now hinged on decisions to be made by the company's directors and a French commercial court, which has authority as a mediator. President Jacques Chirac asked government transport secretary Dominique Bussereau to meet with the head of Air Lib and employee representatives to see if the carrier can be rescued. Chirac asked "that the government do its utmost to help the continuation of Air Lib's activities and that everything be done to favor a takeover of the company by new investors," his office said. With Air Lib passengers stranded overseas, the government said it would try to ensure that the carrier's routes, especially to overseas French territories, were served by other airlines. State-owned carrier Air France said it would increase flights between Paris and the island of Reunion, and that Corsair, an airline operated by tour operator Nouvelles Frontieres, would add flights to the French Antilles. For passengers ticketed on Air Lib flights within France or to Italy over the next few weeks, Air France said it would exchange tickets bought before Feb. 6 for Air France tickets with "an adapted tariff." Air Lib flies to the French Antilles, Algeria, Cuba, and a number of destinations in Europe and France. Founded in 2001 from the ashes of Swissair's insolvent French operations, Air Lib struggled to stay afloat after the government made clear it would no longer subsidize the debt-laden company. The government had insisted that Air Lib agree to repay government loans of 100 million europs to 130 million euros ($108 million to $140 million) and show more detail about its potential financial backers before renewing its license. Air Lib's operating license, already extended to give last-ditch rescue talks a chance, expired Wednesday at midnight. IMCA had said it would be prepared to take over the ailing carrier if the European consortium Airbus would sell it 29 Airbus A319 planes at a bargain price to renew the Air Lib fleet. The Dutch company then announced last month that it would not acquire Air Lib after trade unions rejected plans for a 30 percent rise in productivity. After the announcement, however, the airline's unions tried to persuade IMCA to salvage the deal. Air Lib had said in January that IMCA agreed to buy a 50 percent stake in the carrier. =20 ---------------------------------------------------------------------- Copyright 2003 AP