Adria’s privatisation hopes fade
Six months after Adria Airways put a majority of its shares on sale, Slovenian media report there has been no interest in purchasing the carrier. It comes only days after the Slovenian government shortlisted Adria as one of five public companies whose shares should be sold within the next three months. In August 2012, the Slovenian government offered 74.8% of the airline’s shares and interested parties had until September to submit non binding bids. The invitation for bids was published in the Financial Times, Wall Street Journal and the Flight Global magazine. The Assets Management Agency (AUKN) confirmed that ten parties submitted non binding offers but declined to give out their names. Since then, there has been no information on the progress of the privatisation process. It is believed financial investment firms made up the majority of those seeking shares in Adria, which is not what the national carrier was hoping for.
However, circumstances have changed at Adria since last September. The European Commission has launched an investigation into the carrier’s finances and state aid arrangements, the result of which should be known later this year. Furthermore, the airline’s CEO has been replaced and Adria faces increased competition from Wizz Air, which has hinted at the possibility of launching additional destinations from Ljubljana Airport this year.
Adria’s privatisation process has never officially been declared a failure. The Slovenian carrier is currently undergoing a restructuring program. Its financial results for the previous year are yet to be released although it is believed the airline ended 2012 with a loss of between seven and ten million euros, a major improvement on the year before. However, cost cutting has hit passenger numbers with the airline handling some 987.000 passengers, a 15% decrease compared to the year before.