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Wednesday 28.09.2016 | Name days: Sergejs, Svetlana, Lana
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Minister: the German investor has invested approximately EUR 52 million in airBaltic

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RU«A new page has been opened in the development of airBaltic. In accordance with the contract between the Latvian government and Ralf-Dieter Montag-Girmes, the German investor has invested approximately EUR 52 million in the airline,» – says Latvian Transport Minister Uldis Augulis.

With that, along with fleet modernization and Horizon 2021 business plan, approximately EUR 132 million will be invested into airBaltic. The airline’s shareholders will decide on the increase of the company’s capital on Tuesday, 29 March, as confirmed by Transport Ministry.

«I am confident that decision made thus far in regards to continued function of airBaltic in the past five years, including the more recent investments, have been right so far. As a result, the company will contribute to the country’s overall economic growth, creation of new jobs and provision of internationally recognized services to residents. It should be noted that the aviation industry provides 3% of the country’s GDP. Half of that is thanks to airBaltic,» – notes the minister.

«The first steps have been taken to allow airBaltic to procure new aircraft. Those will become available in autumn. Decisions made so far will also help reduce long-term costs and create new and innovative approaches to passenger service. All the future steps are clear as well – the company has to continue its work in the realization of its development plan and attraction of a strategic investor,» – said Augulis.

«Our residents can be proud of the fact that Latvia has its own national airline, the likes of which cannot be found in either Estonia or Lithuania. It demonstrates our ability to exist in this complicated market niche and maintain the main transport hub in Baltic States, which is a unique and noteworthy accomplishment, emphasizes the minister. Latvia’s airBaltic airline has received awards of excellence as the most punctual airline in the world and the most innovative services,» – adds the minister.

According to him, considering the country’s geographical location in the European Union, Latvia’s aviation industry has a strategic transport infrastructure element to it. Latvia does not currently have alternative forms of transport connectivity with other European countries that would be able to compete with air traffic in terms of efficiency. With that, the state continues to invest into the aviation industry, including airBaltic, because it is one of the most important industries in the country.

As it is known, the Latvian government has decided to approve German businessman Frank Dieter Montag Girmes as airBaltic’s investor. He has agreed to invest EUR 52 million in the airline as long as the Latvian state invests EUR 80 million. The airline’s combined capital of EUR 132 million would contribute to modernization of the fleet and development of the business plan.

According to information from Firmas.lv, Ventbunkers’ turnover was EUR 54 million in 2015. The company’s revenue for that year was EUR 16.9 million.

BNN had previously reported that Ventbunkers has expressed readiness to invest in the country’s national airBaltic airline. Ventbunkers has asked Air Baltic Corporation’s CEO Martin Gauss and Transport Ministry to discuss this investment option.

«Ventbukers, as one of the largest companies in Latvia with stable financial footing, is interested in discussing investment opportunities with airBaltic. Ventbunkers’ economic indexes for the past year demonstrate successful results. We are now prepared to go further. I believe it is important to support local companies to give them the opportunity to grow, develop and create new jobs in Latvia. With that and in spite of the already launched investor attraction process, we as prepared to provide the airline with all the necessary support and discuss investment opportunities for airBaltic’s development,» – comments Eva Cinina, Chairperson of the Board of Ventbunkers.

As it is known, the Latvian government has decided to exclude the procurement of Russian Sukhoi aircraft from airBaltic’s business plan. The government has also approved the decision to appoint Montag Girmes as the airline’s investor.

Saeima has also agreed to allocate a loan of EUR 80 million to airBaltic.

At the same time the Saeima has decided to prohibit airBaltic and its subsidiaries from procuring, leasing or using products made by military industrial complexes facing international sanctions.

As it is also known, one of the largest companies in Latvia – Ventbunkers – had recently expressed  its surprise about Transport Minister Uldis Augulis’ statements to the media regarding the fact that Ventbunkers is not considered as a viable potential investor for airBaltic.

Ventbunkers notes that the company’s freedom to have a look at the airline’s financial state had previously been delayed due to unexplained reasons. This made it more difficult for the company to develop a detailed investment offer. In spite of the fact that an information non-disclosure agreement was signed between Air Baltic Corporation and Ventbunkers in January 2016, the company has yet to receive access to the airline’s legal documents for and in-depth assessment, as reported by Ventbunkers.

«The Transport Minister’s statements in regards to turning down Ventbunkers as a potential investor for airBaltic came as an unfortunate surprise for us in spite of our investment offer and that we have been taking part in cooperation talks with airBaltic and Transport Ministry representatives for several months. This does explain why there have been delays in relation to providing all the necessary information to Ventbunkers,» – comments Ventbunkers Chairperson Eva Ciniņa.

«I believe such an attitude is unprofessional in a situation when the airline is in dire need of investments, especially considering that the attracted German investor is so hard to get in touch with. We do not understand the minister’s public announcement, which came without prior consideration of all options. This is especially shocking considering that there are still some matters that require addressing in the airline, and that the money promised by the German investor has yet to be received. With that, one would ask who will take responsibility when Latvia’s national airline does not receive the necessary funding in time and be put in a critical situation because of that,» – Ciniņa adds.

One of the largest companies in Latvia – Ventbunkers – has expressed readiness to invest in the country’s national airBaltic airline. Ventbunkers has asked Air Baltic Corporation’s CEO Martin Gauss and Transport Ministry to discuss this investment option.

Ref: 102.109.109.7766


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