Argentina to Buy Back Floundering State Airline

Argentina is expected to seal a deal on Monday to renationalize Aerolineas Argentinas, its floundering flag carrier, whose Spanish owner, Marsans, has struggled to cope with soaring fuel bills and debts that have left more than half its fleet grounded.

The airline has spent nearly two decades under Spanish ownership. But the government and Marsans agreed on the sale last week, and it is expected to be finalized on Monday by Julio De Vido, the planning minister, and the outgoing owners.

The government will also send a bill to congress on Monday seeking approval for the buyback. Financial details are to be hammered out during a 60-day transition period, during which the carrier will be run by Julio Alak, formerly a representative for the state, which previously held five percent.

Argentina sold Aerolineas to Iberia, the Spanish flag carrier, in 1991, and Marsans took over in 2001. However, unions and the government complain that financial promises were not kept.