SFGate: Argentina's Senate approves airline takeover

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Wednesday, September 3, 2008 (AP)
Argentina's Senate approves airline takeover
By RACHEL JONES, Associated Press Writer


   (09-03) 22:14 PDT BUENOS AIRES, Argentina (AP) --
   Argentina's Senate approved the nationalization of Aerolineas Argentinas
and its subsidiary on Wednesday, moving to return the financially troubled
Spanish-owned airlines to state hands.
   The 46-21 vote in favor of the takeover of Aerolineas Argentinas and
Austral airlines was the final step in making the nationalization law.
Argentina's lower house in August approved the measure, which requires the
state hold a majority of company shares.
   The text approved by the lawmakers after more than 11 hours of debate
states that Argentina "will proceed in the rescue" of the airline to
guarantee commercial air travel to the public.
   Congress will now set the purchasing price for the airlines.
   Aerolineas Argentinas has been in Spanish hands for nearly two decades.
Since 2001, the airline has been owned by Spanish travel conglomerate
Grupo Marsans.
   The company is struggling with financial woes and labor conflicts, and h=
as
an estimated US$900 million debt.
   Some Argentines celebrated in the streets of Buenos Aires on hearing of
the vote, many holding up inflatable planes.
   But the opposition has questioned the government's decision to take on t=
he
airline before it has resolved the debt and labor issues.
   "There are some who would not permit the payment of a single cent for
Aerolineas Argentinas," senator Ernesto Ricardo Sanz told opposition radio
Union Civic Radial.
   Government supporters responded that financial considerations come
secondary to providing a public service.
   "A public entity doesn't always have to make money, although that's
ideal," said congressman Ariel Basteiro.
   Aerolineas Argentinas and Austral together account for about 85 percent =
of
domestic air traffic.
   ___
   Associated Press Writer Debora Ray in Buenos Aires contributed to this
report. -------------------------------------------------------------------=
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Copyright 2008 AP

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