No takers for revamping Sri Lankan Airlines: Minister

12 May 2016 09:23 am - 12 - {{hitsCtrl.values.hits}}

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The Sri Lankan government has made it clear that no airline company has “formally expressed” interest in the proposed revamping of SriLankan Airlines.

Responding to a query from The Hindu on whether Qatar Airways was being contemplated as a possible international partner, Eran Wickramaratne, Deputy Minister of the Public Enterprise Department under whose purview the airline comes, said “there is no specific party. There are many names that keep coming up from time to time. No one has formally expressed interest.”

“Every party talks to very many different people in the government,” he added.

The restructuring of the airlines had become inevitable as the organisation had been in the red for the past eight years and its liabilities stood at $ 3.2 billion as on December 31, 2015.

Explaining how the revamp plan would be carried out, the Minister said the balance sheet of SriLankan Airlines had to be restructured first as it was “not saleable.” For this, valuation had to be carried out by engaging one or more parties.

Disclosing that the National Savings Bank (which also comes under the Public Enterprise Department) had been chosen as the lead manager, he said an international investment bank with aviation expertise had to be selected, as “there is no local party with airlines expertise.”

With the assistance of the investment bank, the documents for request for proposals would be issued and eventually, one party would be chosen for the proposed partnership. The Deputy Minister was confident that the process up to the selection of the party for the partnership, which he called the “first part”, would be completed in six months.

Of the orders placed in 2014 (during the previous Rajapaksa regime) for the purchase of new aircraft (A 350-900), Mr. Wickramaratne said four aircraft were to be delivered in the immediate future. Of them, one had been “laid off at a reasonably good price.” Negotiations were on with other airlines for the other three.

He also explained how difficult it was to cancel the orders straightaway for the aircraft, as there would be “huge penalties.” He questioned the rationale behind the placement of the orders for wide-bodied aircraft when the airlines had been operating more regional services.

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Comments - 12

Andrew Pitugala Thursday, 12 May 2016 09:38 AM

We remember how Emirates were sent off by MR when they refused to do his bidding at the expense of hundreds of passengers.

spirit Thursday, 12 May 2016 09:50 AM

Better to re-name it as Rajapakse Air Lines and hand it over to so called Gentlemen and see the difference.

BuffaloaCitizen Thursday, 12 May 2016 12:51 PM

He already has an airline Mihin named after him, that is also white elephant. However we still have people in this country who still consider this rabid crook as a hero, that is the sadness of this country.

Sonali Thursday, 12 May 2016 01:31 PM

"the balance sheet of SriLankan Airlines had to be restructured first as it was “not saleable.” ". As in drawing up a bogus one so that it will be "saleable"? Mihin Air is the sole reason for the downfall of Sri Lankan Airlines.

vithura Thursday, 12 May 2016 02:22 PM

Sri Lankan airlines was well managed by Emirates and MR and his family ruined it. What more evidence is needed for their incompetency, these guys have to brought before a parliamentary select committee and grilled on this subject.

TONY Thursday, 12 May 2016 07:27 PM

THE INCIDENT THAT BROKE THE MANAGEMENT AGREEMENT WITH EMIRATES IS CRYSTAL CLEAR. NO NEED FOR ANY INVESTIGATION. AM SURE SAJIN CAN VOUCH FOR THIS

Vernon Thursday, 12 May 2016 10:10 PM

The losses regarding A350-900 could have been minimized if the cancellations were done very much earlier. Now after dragging the feet for such a long time, obviously order cannot be cancelled without incurring huge penalties. The present administration is partly to be blamed.

Ama Thursday, 12 May 2016 10:52 PM

Agreement with Emirates was sealed during CBK regime. In fact, this was one of the great strategic move by the former President. Present regime can seek advise from CBK.

siva Thursday, 12 May 2016 11:25 PM

An International Investment bank is the best option .An exit strategy should also be part of the deal so that the ownership finally reverts back to Sri Lankan Control

kumudu fonseka Friday, 13 May 2016 01:21 AM

MR misused. The money paid as salaries to Sri Lanka n's. Thousands found employment to earn $'s in other airlines.

Ugandan Friday, 13 May 2016 03:01 AM

UGANDA AIRLINES may be a possible International partner.

Dada Friday, 13 May 2016 04:03 AM

Emirates Where Are You Srilankan Need Help ????????

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No takers for revamping Sri Lankan Airlines: Minister

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