Return of Aerolineas Argentinas to government control approved

Following action by the country’s congressional leaders, the Senate in Argentina voted this past week to return financially-troubled Aerolineas Argentinas to state control, in the latest movement by the government to expand its key sector involvement.

Earlier, the Congress had approved a government agreement that was reached in July for the purchase of the stake held in the carrier by Spanish travel operator Marsans.

The two sides have not yet agreed a price for the shares, and after negotiations, the Congress will review the amount in a separate hearing.

After 10 hours of debating the issue, members of the ruling Peronist party and allied factions passed the measure, at a margin of approximately 2:1

The original government bill was modified by the lawmakers, showing greater initiative following a Senate vote in mid-July that put down another government proposal - to raise soy export taxes. The vote was a significant blow to the government of centre-leftist President Cristina Fernandez, who saw her popularity sink during the conflict that ensued.

In regard to Aerolineas Argentinas, President Fernandez has stressed that the government is left with no choice but to buy out the Marsans share, as the troubled airline is in arrears on salary payments.

www.aerolineas.com