Wednesday, September 25, 2013

Croatia Airlines preparing for privatisation

Another EX-YU airline readies for privatisation

Croatia Airlines is carrying out final preparations for the upcoming tender to sell 49% of the company. The Croatian Minister for Sea, Transport and Infrastructure, Siniša Hajdaš Dončić, says that “everything is on course” for tender procedures to begin in a few weeks. The minister outlined that a final evaluation of Croatia Airlines must be completed before the carrier is put up for sale so the airline’s approximate value is known. However, the minister also added, “The price offered by a potential partner will not be paramount, rather, the focus will be on the quality of the strategic partner which could generate more traffic for Croatian airports”.

Mr. Hajdaš Dončić did not mention any potential bidders but said, “Due to the current situation in the European aviation industry we shouldn’t expect any interest from European investors. We are more likely to find them outside of Europe”. Garuda Indonesia, China Southern Airlines and Hainan Airlines have all been named as potential partners. The Indonesian national carrier is the only one to have publicly voiced their interest to purchase a stake in Croatia Airlines. Recently, Mr. Hajdaš Dončić said, “Garuda is likely to answer the tender call because they are interested in our strong connections to the rest of the European Union”. The statement was echoed by Garuda CEO Emirsyah Satar who said that, “Croatia and Croatia Airlines would be a logical choice for us”.

The Croatian government is also preparing to sell off Osijek Airport. The airport has experienced financial hardship over the past few years and has struggled to attract customers. Recently, the Croatian President, Ivo Josipović, met with representatives from Indonesia’s Global Putra International Group which has expressed interest to purchase Osijek Airport and turn it into a cargo hub. Global Putra, established in 1981, is an integrated transport and logistics provider in Indonesia.

32 comments:

  1. I would like for OU to save itself, but I just don't see it happening. So many airlines were named as potential buyers and one by one they were denying it... I think there will be a few failed tenders like Jat had, and in 5-6 years maybe they could find potential buyers. But still I don't see OU surviving 2014/15 winter season.

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    1. It was not. There were speculations in Jutarnji list, but it was not information from Ministrer.

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    2. @Darko MarjanovićSeptember 25, 2013 at 9:11 AM

      U don't see OU surviving 2014/5 winter season, well I don;t see air Serbia surviving 2014, unless Serbian government immediately props it up with $270 million of debt Air Serbia has inherited from Jat, and not forgetting long term debit of another $140 million.

      If I were you I'd be less speculative of what someone else is doing before you look in to your own house which is all but falling apart.

      And OU isn't in such dire straights that it'll need a savior in form of political favors, but needs a proper management that will run the airline as an airline should be run not as someone's little private casino or a tour company.

      also Croatian airlines is a brand, unlike Air Serbia, Croatian Airlines stands for something, has a long term and short term value, quality of service and above all else has a good market and market potential, something that can't be said for air serbia, which has one airport, (nis, come one 35000 pax) and political favours to keep airline in the air at what ever cost.

      I can tell you this, such airlines have no future on market place, they go bust fast. Belgrade such as it is has little perspectives as an major regional hub as every major airport in region is getting spruced up and ready for competition.

      Most in Kosovo, Croatia and Slovenia won't even fly to Serbia, and in Bosnia only Bosnian Serbs are connected and would use Air Serbia and Belgrade as its hub. I simply don't see how Air Serbia can be an viable airline and the fact that Ethiad only dared to invest $100 million (this includes 49% steak in AS) only shows how little faith Ethiad truly has in survival of Air Serbia beyond 2015.


      So when you say Croatian Airlines this and that, look first in to your own rotten airline before making assumptions about others.


      @admin,

      where the heck did you get information of Croatian airlines and statements by Siniša Hajdaš Dončić, u just put up your own little story of assumptions and miss quotes it is ?

      Garuda isn't an investor, they've said they're not interested, already have been posted as a news on all major Croatian news portals like month ago.

      Croatian Government held talks with many potential investors, but for now Rijeka Geatway and High Speed Rail (HSR) link between Zagreb and Rijeka is main priority for the government and search for investors, and this is why government went to visit south east Asia and held talks, Croatian airlines was offers as an investment opportunity among many with interest shown by few parties among them Garuda airlines.

      The Sale won't happen in 2013, but this is only initial consultation stage to see if there's an interest in purchasing stake in OU, what the real value of OU (minus 900 million kuna debt) and how much Government of Croatia can get for 49% steak in the airline, and I can tell you its not a lot, figures are between $150 and 300 million, but priority is to get a quality agreement and not quantity agreement, for airline to be run like an airline and not like someone's personal business as was done during HDZ rain.

      So when you post your informations, plz try to do some research before you do, its highly unprofessional otherwise.










      .



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    3. The amount of hate you spew around here is completely blinding you from seeing that, on the whole, the way OU is run doesn't differ that much from the way JU is (was?) run... Certainly, a few factors are different, but the mindset is the same. Although I don't know why you dragged JU into this discussion, or are all Serbs banned from having an opinion on OU?

      Regards from Belgium.

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    4. '...also Croatian airlines is a brand...'

      Excuse me but for whom? Maybe for those flying from continental Croatia. OU's brand does not really go beyond that geographical area.

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    5. @AnonymousSeptember 25, 2013 at 7:18 PM

      to you anyone saying anything real about Air Serbia is a hater, I guess its normal thing to hear on a Serb bloig, but still I expected more common sense.

      @AnonymousSeptember 25, 2013 at 7:35 PM

      Yes, Croatian Airlines is a brand, very valuable brand as it Croatia Brand. In case you don't understand and see what Croatia brand is, ask 12 million tourists that visit each year, or some of the famous international personalities that holidayed in Croatia this year, or in the past.

      Brad Bit and his family, Tom Cruise, Harrison Ford who bought a house in Croatia, Bill Gates, Elon Musk, Richard Branson, Google Boss and his friends and I can go on. so when you say what brand?

      That Brand !

      Unless you think Croatia isn't a brand.

      And yes countries can brand their names and beauty, or influence, example The Cool Britania, Dolce Vita Italia, Polish plumbers, la jour de vivre France and so on.



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    6. AHAHHAHAHAHAHHAHAAHHAHAHHAHAHAHAHHAHAHAHHAHAHAHAHHA!!!!!!!
      So you actually think that people will think of plumbers when they think of Poland or that people will have some positive image of OU just because of the pretty coast? Do you actually think Tom Cruise or any other celebrity flies on OU?
      I am sorry honey, OU is a brand as much as Tarom is. Nothing more, nothing less. Get over yourself.

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    7. and btw, if Croatia is going to have an international brand, then it's going to be lex-perkovic, eastern europe/balkans and corruption... and then eventually nice nature. Don't fool yourself, most of those 12 million tourists you speak of go there because its cheap.

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    8. Serbia is cheap, yet no one goes there, why is it ?

      Just cause a country is cheap doesn't mean that its going to attract visitors, and sorry you have no idea of polish plumber campaign, but this just shows your ignorance.

      As to OU Brand and Croatia, if you can't see the correlation its your loss, certenly not OUs.

      BTW this is a first time I heard that Tom Cruise, Brad Pit, Harrison Ford... are cheap.

      i hate to think what you think of King of Jordan, British Royal Family or European industrialist that come and visit Croatia each year, I bet they're so cheap champaign turns in to water.

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    9. I think the fact that you elevate Croatia over Poland shows your level of arrogance and chauvinism which disqualifies all your arguments.
      Furthermore, go and read what I wrote. I said that most of the 12 million people are heading there because it's cheap. Croatia is light years behind Greece when it comes to tourism buddy.

      The matter of fact is that Croatia Airlines will most likely fail because of EU legislation and corrupt management. The faster you deal with these facts the easier it will be later on. Mwah. xoxo

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    10. Its ok. Once Croatia dies Adria can step in and take over. Like they did in Kosova and like they will do in Albania.

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  2. I would be happy if they manage to save what's left of Croatia Airlines, especially since we lost way too many airlines to the economic crisis. However, I would rather have the Chinese take it as the Indonesians are experiencing financial problems, especially related to their currency:

    'The Indonesian rupiah has been one of the worst performing currencies in the world recently, falling to a four-year low last month. Indonesia has been caught in a global emerging markets slump that has punished countries suffering from widening current account deficits and concerns about the progress of political and economic reforms...'

    I just hope the government doesn't rush with their decision.

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  3. I think it won't be problem to find partner because OU has quite new planes, good image and huge market. Everybody would like to be partner of an airline company with such a great potential. If Jat with old planes and bad image found Etihad, Croatia will also find somebody :D Actually, everything depends on political will.

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    1. Прво скочи па реци хоп.

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    2. precisely, but i just don't see what political and economical benefits Croatia has with Indonesia. with China i understand, but Indonesia?

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    3. I think you're confusing the potential of Croatia's market as a whole and the OU market.

      Yes, the numbers of tourists are impressive, but the vast majority of these fly in on charter, low-cost, or their own home airlines. The only piece of foreign market that OU can really capture is tourists who are price-sensitive, yet still want a full-service carrier. OU does pretty well in that regard and tends to come out cheaper than the EU heavyweights, especially in the high season. However, the last thing tourists want is to connect to their final destination via ZAG, which they often have to if they require flexibility in terms of time of departure/arrival, and OU has shown in the past that isn't not exactly capable of running too many flights from secondary airports efficiently and cost-effectively.

      The only way of survival I see for the company is to create a really good fleet management plan for the winter months and then work at 105% of their capacity during the summer. Unfortunately, planes being sold off is not one of the possible ways to get there.

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    4. Bravo , well said

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    5. @AnonymousSeptember 25, 2013 at 1:08 PM

      Most tourist that fly to the coast with OU in summer season do not fly via Zagreb but directly, as evident from OU's timetable and transfer numbers at pleso which are ridiculously small, around 12000 per year.

      Problem of OU is corruption with in OU and political corruption in the past that has brought OU in to mess that it is in.

      OU has too few aircraft to do what it suppose to do in summers and barely enough aircraft to do what it needs in winters, OU management doesn't want to commit to 40 scheduled destinations in winter cause they know they won't be able to service these in summers so there are 20-22 european destinations OU flies to out of Zagreb, Split, Dubrovnik, Zadar, Pula and Rijeka, with varying degree of frequencies.

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  4. Due to enormous interest Jat has 2 flights to Dubrovnik today. Air Serbia put on sale flights to Dubrovnik from March 30, 2014 - Tue,Thu,Sat.

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  5. It seems that this the latest Air Serbia A319 to be painted in its livery. It looks very nice in my opinion.

    https://fbcdn-sphotos-h-a.akamaihd.net/hphotos-ak-frc3/1375194_215261941931500_1769150873_n.jpg

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    1. rečenica ti je skroz konfuzna. da li hoćeš da kažeš da treba tako da budu ofarbani ili da je ofarban kao i ostali (što se meni čini), zaista ne znam šta si mislio. ako misliš da je drugačiji od ostalih, nije, jer je jedino vreme bolje na drugim slikama i zastava je ispod kabine (što će i ostali dobiti kada dođu u Beograd)

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    2. 'It seems that this is the latest...'

      То сам хтео да напишем. И да, хтео сам да кажем да је офарбан као сви остали.

      Delete
  6. Wow, 5-6 year prediction, what else do you see happening in the future?

    -- Charlie

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    1. this reply was meant for Darko Marjanović's initial comment.

      -- Charlie

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  7. To all of you out there please dont forget we are talking about Croatia Airlines .The best airline in the region .yes they are in financial difficulty but they still fly to the beautiful coast in Croatia .Do you know what it means to Croatia economy if they are not flying and how many people loss their jobs not only by Croatia Airlines , so please people lets hope that they stay flying for many years

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    1. Refer to my post above explaining why "the beautiful Croatian coast" is insufficient to make the carrier profitable with the existing fleet and pricing structure.

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    2. currently, they are, probably, the best (don't want to argue who said that, that's not the point). but at this rate they will lose that position (thanks to the incompetent management) and will stop flying if someone doesn't come to save them (also, because of incompetent management). JU will chew them in the future, so Croatia must find someone like EY to save OU. and that's NOT GA. MU could be, but not GA

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    3. If OU stops flying, it means 1500 jobs less in the Croatian economy. I am sure Croatia has been through much greater economic shocks.

      The beautiful (indeed) coast of Croatia will not go away if OU goes down. It will stay where it is, other carriers will step in and provide transport to all passengers who wish to fly to Croatia. If there is demand for flights to Dubrovnik, Split, Rijeka, Pula... then there will be flights, with or without OU.

      So no worries for customers, or the economy as such. Those who would suffer if OU goes down are thevaviation sector employees and enthusiasts in Croatia. I hope they will not get completely screwed by politicians and their mismanagerial philosophy of an airline being an expensive political toy. But we should be realistic and say that whatever happens to OU, life and economy in Croatia will go on. And there will be other airlines.

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  8. OT, Wizz Air soon in Sarajevo

    http://www.avaz.ba/vijesti/iz-minute-u-minutu/wizzair-uskoro-polijece-iz-sarajeva

    :)

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    1. They just copied and pasted ex-yu aviation's article from yesterday ;)

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  9. @AnonymousSeptember 25, 2013 at 5:26 PM Please do not make false statements regarding quotes made by politicians, airline officials and executives which have been carried here. They are well documented by the media and other sources. Furthermore, please hold back your assumptions as to whether this is a "Serbian" blog or otherwise. This is a blog dedicated to news from the aviation world of the former Yugoslavia. The amount of news regarding all airlines and airports in the region and fresh news, which has been published every single day for the past five years, proves that point. Thank you.

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