Air France’s board approved plans to acquire rival Dutch airline KLM, a board member said. The union would create one of the world’s largest aviation partnerships.

KLM Royal Dutch Airlines NV said talks on an alliance with Groupe Air France SA have reached a critical stage but are confident that they will conclude successfully.

A spokesman for KLM confirmed today that agreement is near on a proposed merger with Air France.

KLM could lose thousands of take-off and landing rights at Amsterdam airport Schiphol next year, following an error at the airport that will reduce the number of allowed flights in the short term, the airport's CEO Gerlach Cerfontaine said.

KLM is considering seeking up to £19m compensation for damages linked to the US terror attacks.