Air France-KLM will pay 323 million euros (431 million U.S. dollars) to acquire a 25-percent stake in Italian airline Alitalia, both companies confirmed Monday.

Alitalia, the 62-year-old state-run company, had gone bankrupt. The new Alitalia will be launched Tuesday with Air France as a shareholder along with other Italian investors, bringing the French airline into the Italian air travel market.

Air France-KLM said it will underwrite a reserved capital increase, with 19 seats on Alitalia's board and two seats on its executive committee.

Meanwhile, a four-year lock-up agreement will be in place, which means no Italian shareholder will be able to transfer shares externally to Air France-KLM or the Alitalia shareholders group until January 2013.

The cooperation agreement was achieved after many weeks of talks, which will bring synergies of 720 million euros (964.37 million dollars) over the first three years, said Roberto Colaninno, the new Alitalia CEO.

Air France-KLM competed with Germany's Lufthansa for more than three months over the stake in the Italian airline.

Source:Xinhua