Greece's two major airlines, Olympic Air and Aegean Airlines, said they are merging to create "a national champion," company officials said Monday.
Both carriers said their main shareholders reached an agreement regarding the merger and the formation for a new listed carrier in order to better compete within the European Union and preserve jobs in the industry, the Athens News Agency said.
Officials said the maintenance base, Olympic Handling and Olympic Engineering, will become 100 per cent subsidiaries of the new company.
The merger must be approved by European Union officials before it can be legally accepted, dpa reported.
The new company will begin operating in October and will use the Olympic Air name and logo after a transition period in which the Aegean name will be used in parallel.
Together, the two companies' fleet consist of 64 aircraft and will have 5,850 employees.
Olympic, which is the successor airline to debt-ridden, state- owned Olympic Airways, was sold to MIG after several unsuccessful privatization attempt in 2009.
Together both airlines fly 65 domestic and 41 international routes. Aegean is a regional partner of Lufthansa and is in collaboration with Brussels Airlines and Britain's bmi.