Proposals for the financial restructuring of struggling Caribbean carrier LIAT will aim to relieve its heavy debts before promoting growth through deals with major airlines and local carriers such as BWIA West Indies Airways.
Shareholders in Antigua-based LIAT will soon meet to consider plans to reduce or retire $30 million of debt by writing it off or converting it into equity. An injection of fresh capital will also be sought. Over 50% of LIAT is owned by island governments including Antigua, Barbados, Dominica, St Kitts, St Lucia and St Vincent, with Trinidad and Tobago-based BWIA holding 29% and banks and employees the rest.
LIAT chief executive Garry Cullen says the airline is "carrying too much debt", and that "the business plan will give us a much healthier bottom line". He adds that the three-year plan acknowledges the need to ally "with like minded small carriers as well as international airlines".
LIAT has signed alliances with St Maartens-based Winair and Antigua's Carib Aviation, which will operate to islands including Barbuda, Dominica, St Kitts and Nevis, allowing LIAT to focus on longer sectors. It is also looking for a third partner in Barbados to strengthen its hand in negotiations with international carriers.
A long-term strategic pact with BWIA should be sealed in October, while LIAT is also poised to sign a new feeder agreement with Virgin Atlantic and is reviewing a similar deal with British Airways. LIAT expects to make a modest operating profit by the end of its accounting year in October.
Source: Flight International
