The Greek government is to agree the sale of state-owned flag carrier Olympic Airways to Australian investment company Integrated Airlines Solutions (IAS), which will take a 51% stake in the airline for €102 million ($91.7 million).

Negotiations should be completed by the end of the month, according to government financial advisers CSFB. The deal has yet to receive European Commission approval, however, and the government is still unhappy with some points of IAS's revised business plan for the airline.

IAS has also asked for options on a further 16% of the airline within three years, at the current price plus 8% interest per year, and a six-month period to acquire Olympic's catering arm. The airline should be handed over to its new owners in May.

Meanwhile, fellow Greek airline Aegean-Cronus Airlines, recently formed by the merger of regional carrier Aegean Airlines and short-haul operator Cronus Airlines, plans to expand with the launch of charter operations in March, says president Theodore Vassilakis. He predicts that the move will increase revenues by 20% and would not interfere with Aegean-Cronus's domestic operations.

Aegean-Cronus has already signed deals with UK, French, German and Italian tourist organisations. The charter operation will use four of the airline's fleet, which consists of three ATR72s, six BAE Systems RJ100s and six Boeing 737s.

Speaking to a meeting of the Greek union of tourist organisations, Vassilakis also called for cuts in airport fees and taxes, which he said made the country's ticket prices among the highest in Europe, to help Greek airlines survive the slump.

Source: Flight International