Croatia Airlines’ plans to sell landing/take-off slots at London Heathrow are on hold.
Transport Minister Oleg Butković and State Property Minister Goran Marić, on behalf of the state which is the owner of Croatia Airlines, have banned until further notice the company to sell its landing and take-off slots at London Heathrow Airport, reports Jutarnji List on November 28, 2016.
At last week’s meeting with the CEO of Croatia Airlines Krešimir Kučko, the ministers have also requested that the Board of Directors submits by 15 December a detailed report on the financial status of the company and its plans for the future. The report must be presented to the Supervisory Board. After a detailed analysis of the plan is completed, the final decision whether to sell the slots will be made.
According to unofficial information, at the meeting ministers Marić and Butković rejected an argument made by the CEO that Croatia Airlines was posting positive business results, but that at the same time it had to sell its assets in order to finance servicing of aircraft engines. They also did not accept the argument that the selling of slots would increase the value of the company. According to the ministers, the decision on the sale of slots had been made too hastily without a detailed analysis. They also did not accept the argument that the selling was included in the restructuring programme adopted in 2013.
Claims by the company’s management that the decision on the sale of slots was purely economic was also not accepted. Kučko has repeatedly argued that the company, on the flights to and from Heathrow, lost 21 million euros from 2002 to 2013. This year, the loss on the service will be around one million euros, the same as last year. In addition to the issue of slots, the management will have to present to the Supervisory Board its plans for the overall future of the company, which includes the possibility of finding a strategic partner.
Former government led by Zoran Milanović tried on several occasions to bring a strategic partner to Croatia Airlines, but its efforts failed. In the end, an investment fund of the World Bank was hired as a consultant, in order to analyze the market and the interest of potential investors. According to available information, after the analysis was completed and after responses from 13 airlines were obtained, their conclusion was that there is no interest in investing in Croatia Airlines.
