MercoPress. South Atlantic News Agency

Aerolíneas back in the air rescued by Argentine gov.

Spanish group decided to leave Argentina

The Argentine government could take control of Aerolíneas Argentinas and Austral to guarantee regularity of commercial flights and protect Argentine assets and 10.000 jobs, anticipated the representative of the State in Aerolíneas Argentinas Julio Alak.

However Argentina's Transport Secretariat denied that the government could be interested in acquiring the Argentine flag carrier, and highlighted that private investors have already shown interest in Aerolíneas. Last Friday the Argentine government decided to pay the salaries of the company's employees, as well as fuel and aircraft leasings toward a normalization of the company which has been plagued with strikes due to delays in wage payments. Argentina owns only 5% of the airline, while 94%belongs to the Spanish group Marsans. The rest is in the hands of the company's employees. Spanish press reported Marsans has requested that Spanish President José Luis Zapatero take action in the conflict, as the company is alleging that the administrations of Cristina and Néstor Kirchner have set financial obstacles to the company. Marsans says the government attempts to discredit the company and denounced pressures from the Argentine authorities acting through the company's unions. Meanwhile, the Argentine government justifies its actions by complaining that the company has repeatedly violated agreements with suppliers and its employees. On Thursday, the government requested that the judiciary put the airline under federal trusteeship, following several irregularities that took place in recent months. Alak said he is "intensely working with the teams of the Planning Ministry and its Transport Secretariat to guarantee the payment of the salaries, the leasing of planes and the purchase of fuel so that the company can continue to operate normally." "Given the situation of the company, if the majority shareholder ? Spanish group Marsans ? does not urgently invest, we don't rule out that the government will have to assist it again". Meanwhile, Transport Secretary Ricardo Jaime said during an interview to América radio that "private operators are very interested to take over Aerolíneas Argentinas". However Jaime had a different position from that of Alak and argued that a possible re-nationalization the company has almost been ruled out. He went on to say that "the role the government will play in the conflict was clarified 50 days ago, when it signed an agreement to acquire 20% of the company, and opened the possibility to invest Argentine capital in Aerolíneas and Austral for up to 35% of the company". Jaime defended the government's role in the takeover of the company and said that the state has already increased airfare prices this year, while it also subsidizes the fuel the company uses. He added that Banco Nación has given the company 100 million pesos to keep operating. Aerolíneas is Argentina's main airline with 80% of domestic flights. Many companies are interested in buying Aerolíneas among them the Kirchners' friend Juan Carlos López Mena, owner of Buequebús, the ferries that link Buenos Aires with Colonia and Montevideo in Uruguay. Lopez Mena issued a letter of intent to acquire 35% of the company. But Antonio Matta, fomer Spanish partner in Aerolíneas and who was CEO for five years until 2005, interviewed by the Buenos Aires press said the company "as it is, it's not viable" and blames Ricardo Jaime for deliberately blocking the performance of Aerolineas. "He's been running the show for the last twelve months", said Matta of Jaime who he accuses of helping his political cronies and wanting Aerolineas to keep running as a monopoly. Matta also said the alleged interest from private businessmen is "baloney", and added that "there's nobody in Argentina who can pick up the pieces of Aerolíneas; it is part of Jaime's show to keep the company under his whim". (BAH).