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Tuesday 24.01.2017 | Name days: Krišs, Eglons, Ksenija
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Financial investor finally found for airBaltic airline

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUA financial investor has been found for Latvian national airBaltic airline in Western Europe. This investor is prepared to allocate approximately EUR 50 million for the airline, as reported by CEO of Prudentia Karlis Krastins.

The name of this investor cannot be revealed at this time because of confidentiality rules. It is said that it is ‘a solid European investor’ who sees airBaltic’s competitiveness. A respectable law firm and audit company are involved in the deal’s preparation process. The Bank of Latvia is also involved in the process.

In total, it is planned to invest in airBaltic’s capital EUR 120-130 million. This money will come from the state as the airline’s shareholder and the investor. The state could invest around EUR 80 million.

The final decision on the new investment into airBaltic from the state as the shareholder will have to be made by the Cabinet of Ministers. Officials in charge of airBaltic are informed of the airline’s business plan until 2021. This matter will soon be discussed in the airline during the next government meeting.

Krastins predicts that the deal with the new investor could be signed in the next three weeks’ time. The name of this investor will be revealed then.

Krastins did not deny that ideally the strategic investor would be some airline, which would provide not only money, but also new passengers. The airline is still looking for an investor of this kind. Finding a financial investor does not go against finding a strategic investor in Asia. Transport Ministry has invested a lot of effort in improving cooperation with China in the transport field. Currently officials hold talks with a powerful Chinese group in regard to cooperation with airBaltic and transport field in general.

Krastins also adds that there is a lot of competition in the region in terms of finding investors. Polish LOT and Finnish Finnair are also looking for investors.

As noted by the CEO of Prudentia, airBaltic has developed a new, structured business plan until 2021. According to this plan, the investment will be carried out in 2015. The goal is to restore the airline’s fleet. A contract was signed with Canadian Bombardier a few years ago for the procurement of passenger aircraft.

According to Krastins, this year was both very hard and important for airBaltic. Restructuring resulted in fewer flights and personnel. But it also helped optimize costs, which helped airBaltic make profits again. The company is now able and willing to develop, and is well-positioned for growth, said Krastins.

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