Shares in the aviation conglomerate, SairGroup, dropped almost seven per cent on Tuesday to lows last seen four years ago.
Shares in the group fell to 209.75 as investors digested news of Monday's agreement to inject new capital into the ailing Belgian carrier, Sabena.
The fall in the SAirGroup's share price helped to push Swiss blue chips to a fresh daily low for 2001. The SMI was down 62.7 points or 0.8 per cent to 7706.2.
Shares in the SAirGroup weren't helped when the newly appointed head of the company's French affiliates, Marc Rochet, warned employees that losses in 2000 of around SFr580 million ($350 million) could result in their going out of business.
Despite the agreement to save Sabena from bankruptcy, the SAirGroup has also raised doubts about its long-term commitment to the airline.
The company, which owns a 49.5 per cent stake in Sabena, says it intends to keep its options open regarding its future involvement in the Belgian carrier. A key issue is its agreement with the Belgian government to raise its holding to 85 per cent. The Belgian government currently has a 50.5 per cent stake.
SAirGroup's head of communications, Beatrice Tschanz, said the company's decision to back the capital increase was based on existing contracts. "I cannot explain it in days or weeks but it was clear from the SAirGroup side... [that] we want to have negotiations with the Belgian state to keep all the options open."
SAirGroup's decision to approve the cash injection of €250 million (SFr382.5 million) followed weeks of tough bargaining with unions and pilots over SFr80 million in cost cuts demanded by the shareholders as a condition for the new equity.
Sabena's unions and pilots signed an agreement on the costs cuts, which entail 700 job losses, on Monday.
SAirGroup is undergoing a major change of direction, following the departure last month of its chief executive, Philippe Bruggisser. He had pursued an aggressive acquisition strategy, buying stakes in several regional and national carriers.
The group said last month it would be calling a halt to all new acquisitions and concentrate on its core airline and airline-related businesses.
Swissinfo with agencies