The Polish government says it wants to postpone the sale of state carrier LOT Polish Airlines until next year, following delays in foreign ownership laws. LOT is now likely to look for a foreign strategic partner after the appointment of an advisory team to aid in the airline's privatisation.
Although a timetable for the sale has not yet been agreed, it is thought a majority stake will be sold to another airline but with the government holding onto a 'golden share'. The government has also appointed Polish consulting company Business Management and Finance, US-based consultants SH&E as well as Dresdner Kleinwort Benson and Commerzbank to advise on the privatisation.
Last year, LOT made a loss of 3.1 billion zloty (US$902 million), worse than the 345.9 million zloty loss in 1996, but with a $100 million eurobond issue in process, it says it will easily meet its investment commitments and leasing payments for 1998.
Meanwhile, British Airways and Malév are both denying reports that the Hungarian carrier may have to give up its long-haul flights as part of a deal with BA. Reports in local Hungary newspapers said that BA was insisting that Malév surrender its two existing long-haul destinations to Bangkok and New York/JFK, as well as its proposed routes to Toronto and Beijing, as part of a possible acquisition.
The report also says that Malév would have to switch its existing London/Gatwick routes to Heathrow, despite Malév only recently starting operations to Gatwick. A spokeswoman for BA says that there was 'absolutely no substance' to the speculation and that a BA statement asking the Hungarian government to take the lead on Malév's privatisation was misrepresented.
The new Hungarian government has put on temporary hold all privatisations in the country, but BA says a deal may yet be in place by August. It is expected that BA will purchase either a majority or a large minority stake from the state holding company APV. One deal between the two has already been scuttled. In May, the APV said the board of Malév turned down a draft contract with BA because 'the terms did not allow for sufficient integration of Malév into the British carrier.'
According to Pal Szabo, APV's general director, the agency would like to persuade BA that Malév, 'should be integrated into BA more than is usual in such strategic alliances.'
Elsewhere in the region, the Ukraine government says its wants to start privatising its national carrier, Air Ukraine. In July, the airline was due to be converted into a joint stock company and the government now says it is looking for a financial rather than strategic investor for the airline. It also said it will keep hold of no less than 51 per cent, effectively discouraging any western investor.
Source: Airline Business
