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Monday 18.11.2019 | Name days: Doloresa, Aleksandrs

Flick could consider purchasing state's airBaltic shares

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The President and co-owner of airBaltic Bertolt Flick

The President and co-owner of airBaltic Bertolt Flick could consider purchasing all of the state’s airline shares, he informed the business portal Nozare.lv.

«Let’s put it this way – yes, if it is possible to finance this – we could consider it,» Flick answered to the question whether he would be ready to buy 52.6% airline shares from the state. He is the owner of the main airBaltic shareholder SIA Baltijas aviācijas sistēmas (BAS).

However, currently Flick focuses on defining business strategies together with the state for the next three to five years. In his opinion, the last week’s discussions on BAS plans to build an airline in Lithuania raised the question of the need to talk about airBaltic as a strategically important company in the Latvian national development.

At the same time Flick admits that these are long-term issues that are not decided upon three days before elections rather than when new government is formed and the moving forward is discussed professionally and seriously. «This is not an issue to be evaluated this week, that is impossible,» emphasized Flick.

He restrained from talking about the possible development of the company if it was only in «private» hands, indicating that each private shareholder can have its own completely different aims. He believes that airBaltic has a strong development potential in Latvia. At the same time the company has to work with positive indicators and increase its value; that is a natural investor’s wish, added Flick.

Speaking about airBaltic brand sale to BAS, which, according to experts, decreased the value of the company, he pointed out, «Clearly airBaltic needed improvement of its indicators, in a long-term the the company should own the brand for sure.» Flick also said that he has not changed his mind which was declared by the Prime Minister Valdis Dombrovskis by saying that first an agreement was reached that BAS returns the brand to airBaltic, but now Flick is offering the state to purchase it. BAS owner did not give any other comments on the future actions, only adding, «We shall specify these actions.» He gave the same answer when questioned about what will happen with 93 500 lats that airBaltic has already paid for the brand.

When asked, whether difficulties in operating flights to CIS countries would arouse if the state did not have any airBaltic shares, Flick told that the company’s shares are not necessarily to be owned by the state, a Latvian enterprise can also be the owner.

Nozare.lv found out in the Ministry of Transport that in order an airline could operate flights to CIS countries, there are to conditions. First, 51% or more of it has to be owned by a Latvian or other European Union (EU) member state citizen or the state of Latvia. Secondly, the company must be registered in Latvia. Air transportation is provided under the bilateral inter-governmental air transport agreements, as well as the relevant European Union regulations.

As it has already been reported, currently BAS has no intentions to sell airBaltic shares, yet, according to Flick, the best way to privatise airBaltic would be to register the company in the Stock Exchange, attracting new investors. If airBaltic shares were offered in the Stock Exchange, BAS would waive its pre-emptive rights to airBaltic shares, Flick had informed the newspaper Diena previously.

TV 3 broadcast Nekā personīga reported previously that one of the leading Chinese airlines Hainan Airlines has shown its interest in the shares owned by the state. According to the broadcast, it is likely that the airline is to change its owners after the elections.

Investment bankers have informed Nozare.lv that the state should consider selling its airline shares, although this is not a very favourable time for selling the state assets.

Currently the state owns 52.6% airBaltic shares, BAS – 47.2%. BAS became the shareholder of airBaltic in early 2009 by purchasing the shares from SAS (Scandinavian Airlines) for 14 million lats.


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