LV: Government could take over airBaltic.

By bne IntelliNews November 30, 2011
According to the report by LETA based on governmental sources, the government is preparing to take over the national air carrier airBaltic. Currently the government is revising the situation in the light of recent closure of Latvijas Krajbanka and SNORAS Bankas which were the main creditors of airBaltic and came to a conclusion that there can be no guarantees that private shareholder BAS is going to fulfil its obligations in increasing airBaltic's capital. An ongoing conflict between the CEO of airBaltic Bertold Flik and the government ended with the resignation of Flik and appointment of Martin Gauss, a former CEO of Hungarian airline Malev. It was also announced that the State Treasury transferred LVL 16mn to the capital of airBaltic. Flik was working as airBaltic's CEO since 2002. Flik's resignation was one of the conditions of government-approved austerity package for airBaltic. Government approved increasing the capital of airBaltic by LVL 57.67mn (EUR 82mn), should the private shareholders of the company Baltijas Aviacijas Sistemas comply with government's conditions. BAS was expected to invest LVL 50mn, proportional to its share in the company, to cover operational losses. National air carrier airBaltic posted unaudited loss of LVL 34.2mn (EUR 48.7mn) in 2010. Company's 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. airBaltic's supervisory board proposes the government to increase the capital of the company by LVL 63.68mn. BAS controlled by airBaltic ex-CEO Bertold Flik was constantly in tension with government's representatives over transparency of airBaltic's management.

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

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