LV: airBaltic capital injection to increase needed budget consolidation-FinMin.

By bne IntelliNews August 29, 2011
FinMin press service came up with an statement in which it called to recognise that increasing capital of the national air carrier airBalti could increase budget deficit and thus also budget consolidation for 2012. FinMin stresses that any decisions in this regard should be taken only after thorough evaluation and analysis. Indeed, private shareholder of airBaltic Baltijas Aviacijas Sistemas that announced last week that it is ready to sell its stake in the airline giving the government the right of first refuse, reportedly values its stake in the company at about EUR 130mn. To remind, the announcement came after last week the government decided to support the national air carrier airBaltic, either by taking the company over or injecting additional capital. However, the condition is that current CEO of airBaltic Bertold Flik (controlling BAS) is out of his chair. Other necessary conditions for government support include re-drafting the shareholders agreement and leaving Riga International Airport as the basis airport for airBaltic. As reported, national air carrier airBaltic posted unaudited loss of LVL 34.2mn (EUR 48.7mn) in 2010. Companys financial performance this year was not yet officially announced, but according to previous reports by the ministry a government-ordered audit of airBaltic showed losses of about LVL 13mn in Jan-May 2011. airBaltics supervisory board proposes the government to increase the capital of the company by LVL 63.68mn. The Communication Ministyr admitted that the financial situation of the company was poor, with its own capital being the lowest among other European carriers. At the same time PM Valdis Dombrovskis warned the minister against rushing to increasing airBaltics capital, reminding that many demands posed by the governments to its private shareholder Baltijas Aviacijas Sistemas, mainly considering the transparency of managing the airline, were not met. Air carriers second shareholder Baltijas Aviacijas Sistemas (BAS) controlled by airBaltic CEO Bertold Flik (owning 47.2% of airBaltic shares, the rest owned by the state) is constantly in tension with governments representatives over transparency of airBaltics management.
Read in IntelliNews Pro
Get IntelliNews Pro

Related Articles

EE: Estonian Air records EUR 49.2mn loss in 2012.

Estonian national airline Estonian Air recorded net loss of EUR 49.2mn in 2012, up from net loss of EUR 17.3mn in 2011. Operating loss amounted to EUR 35.8mn in 2012. Revenues of the company ... more

LT: Malsena acquires Latvian flour manufacturer Rigas Dzirnavieks.

Lithuanian flour manufacturer Malsena announced that it has acquired Latvian flour manufacturer Rigas Dzirnavieks. The company indicates that with the acquisition it will become the largest flour ... more

EE: Estonian Air to return excess Embraer airplanes.

Estonian national airline Estonian Air announced that it agreed to pay penalties for returning two excess Embraer E190 aircrafts to the manufacturer. The company has started restructuring and ... more

Most Read

  1. Siemens considers quitting Russia
    10 days ago
  2. Wildfires hit Croatia and Montenegro’s Adriatic coast
    6 days ago
  3. Tajik president’s 23-year old daughter appointed deputy head of largest Tajik bank
    4 days ago
  4. Nato still has a mixed reception in Emerging Europe
    9 days ago
  5. MACRO ADVISER: It's the oil price, stupid
    7 days ago
  1. CHINA RISING: When sleeping giants meet
    13 days ago
  2. Belarus’ retail king Euroopt goes on the road
    18 days ago
  3. STOLYPIN: Russia’s cyber-challenge cuts both ways
    21 days ago
  4. Siemens considers quitting Russia
    10 days ago
  5. COMMENT: Gazprom’s exit from Turkey is a sign of the times
    10 days ago

Selected articles from our premium news/views wire IntelliNews Pro

Login to IntelliNews Pro
Get IntelliNews Pro

Reports

Notice: Undefined index: subject_id in /var/www/html/application/controllers/IndexController.php on line 335
Dismiss