Sri Lanka has revived the process of privatising the state-run carrier, which is saddled with at least $ 1 billion of debt, a year after talks with sole bidder TPG Capital collapsed, following the due diligence of the struggling airline.
The island nation’s Finance Ministry will seek preliminary bids for SriLankan Airlines by September or October, said Mano Tittawella, an adviser to the ministry, in an interview late Monday.
There has been “fairly serious” interest in the sale, and the Government expects to be in talks with at least two parties by the first quarter of next year, he added. SriLankan Airlines is competing with Gulf carriers like Etihad Airways, PJSC, and Emirates for customers in the local market, and years of losses have prompted the government to look for a buyer, and an offer to absorb all the company’s debt.
In attempts that started in 2016, at least eight parties showed interest in the sale. Those included US buyout firm Blackstone Group LP and TPG, Bloomberg News reported at the time.
Emirates held 44% of SriLankan Airlines until 2010, when the Government bought the stake following the end of the 26-year long civil war.
The allure of buying into an airline in the tourism-dominated nation primarily lies in its close proximity to India, the world’s fastest growing aviation market, where an emerging middle class is increasingly flying overseas for work and leisure.
The company’s accumulated losses stood at Rs. 141.1 billion ($ 879 million) as of March 2017, according to its annual report.
(Bloomberg)
The island nation’s Finance Ministry will seek preliminary bids for SriLankan Airlines by September or October, said Mano Tittawella, an adviser to the ministry, in an interview late Monday.
There has been “fairly serious” interest in the sale, and the Government expects to be in talks with at least two parties by the first quarter of next year, he added. SriLankan Airlines is competing with Gulf carriers like Etihad Airways, PJSC, and Emirates for customers in the local market, and years of losses have prompted the government to look for a buyer, and an offer to absorb all the company’s debt.
In attempts that started in 2016, at least eight parties showed interest in the sale. Those included US buyout firm Blackstone Group LP and TPG, Bloomberg News reported at the time.
Emirates held 44% of SriLankan Airlines until 2010, when the Government bought the stake following the end of the 26-year long civil war.
The allure of buying into an airline in the tourism-dominated nation primarily lies in its close proximity to India, the world’s fastest growing aviation market, where an emerging middle class is increasingly flying overseas for work and leisure.
The company’s accumulated losses stood at Rs. 141.1 billion ($ 879 million) as of March 2017, according to its annual report.
(Bloomberg)