El Al float gets go ahead

The flotation of Israel's national airline El Al is set to go ahead later this month, the Israeli Finance Ministry has said.

The sale, which is due to take place on 10 June, will value the company at $113m (£70m).

The flotation finally got the green light on Friday when a Tel Aviv court rejected a petition from El Al employees.

The airline has struggled financially in recent years, following a severe drop in the number of tourists visiting Israel during the conflict with Palestinians.

Lengthy process

A ministry spokeswoman said the government is to sell its 97% stake in the airline, the Reuters news agency reported, although it would take time for the full sale to take place.

For the next 18 months, just more than 50% of the airline's shares will be retained by the government and El Al employees.

"We are selling the whole thing right now but there will be options so it will take time until the public owns 100%," said a spokeswoman for the Government Companies Authority (GCA), the agency in charge of privatisation.

El Al reported a net loss of $23.7m in 2002 and a loss of $85.2m in 2001.

During the first three months of 2003 it made a loss of $33.5m as business was hit by the war in Iraq.

The privatisation of El Al has proved controversial as it is likely to end the ban imposed on the airline flying on the Jewish Sabbath.

Finance Minister Benjamin Ntanyahu has said he will not stop new owners from flying on the Sabbath.