Olympic Air in appeal against EU

The Greek government wishes to privatise Olympic

Ailing airline Olympic is to appeal against a European Commission ruling that it received illegal state aid and must repay it to the Greek government.

The announcement was made by the Greek Transport Minister Mihalis Liapis, who did not specify whether the government would also be appealing.

Brussels ruled last week that Olympic must repay up to 540m euros ($663m; £364m) to the Greek administration.

The Commission said the payouts gave the airline an unfair advantage.

They were paid to state-owned Olympic since 2002.

Financial woes

The Greek flag-carrier has been struggling for years despite receiving regular subsidies from Athens.

Two years ago, its full name was changed from Olympic Airways to Olympic Airlines under a rescue plan, but its financial difficulties have continued.

The Greek government now hopes to privatise Olympic, but the airline having to pay back 540m euros could threaten such a move.

Greek prime minister Costas Karamanlis said the government was committed to ensuring Olympic had a viable future.

"The main aims of the government are to ensure the rights of (the airline's) workers, the subsidy of flights to the islands... healthy competition and a viable solution," he said.