Saturday, March 12, 2016

Prosecutor 'investigating Montenegro-Etihad deal'


Montenegro's Special State Prosecutor's Office has launched an investigation into the recent Commercial Cooperation Agreement between Montenegro Airlines and Etihad Airways, according to the pro-government "Pobjeda" daily. The Prosecutor is said to be focusing on a proposed codeshare agreement between the two companies, which would see the Montenegrin carrier place its codes on a number of Etihad's flights. However, it is unclear as to why the agreement is being investigated, with the Prosecutor's office refusing to comment on the case. The Montenegrin government has strongly supported closer ties between the two airlines, which could eventually lead to an equity investment on Etihad's behalf. According to the "Pobjeda" daily, Serbia's former Finance Minister, Mladjan Dinkić, oversaw the drafting of the cooperation agreement, acting as an Etihad advisor. Neither Montenegro Airlines nor the Emirati national carrier have commented on the matter.

Late last month, Etihad Airways presented its plans to return Montenegro Airlines to profitability and improve the carrier's overall business. The two sides held talks in Abu Dhabi where Etihad outlined plans for Montenegro Airlines to significantly boost its frequencies on profitable routes and improve its overall fleet efficiency. Furthermore, the national carrier of the United Arab Emirates identified potential codeshare partners which would give Montenegro Airlines access to an additional fifty destinations. The new partnership is expected to boost synergies between the two carriers, providing Montenegro Airlines access to benefits enjoyed by Etihad and its partners on the market. The measures are expected to increase passenger numbers, support the local tourism industry and generate a profit for the carrier in a relatively short period of time. It comes after the two signed a Memorandum of Understanding for Strategic Commercial Cooperation in November last year.

Montenegro Airlines has accumulated debt of up to 71 million euros and is believed to have ended 2015 with a loss. On Monday, the Montenegrin government announced it would swap a 2.1 million euro loan to Montenegro Airlines for equity. The debt-for-equity swap was approved by the airline at an extraordinary shareholders' meeting. Under the deal, Montenegro Airlines will issue new shares, boosting its share capital to 34.7 million euros. Last year, the Montenegrin government wrote off 3.7 million euros worth of debt and approved state guarantees for a 6.5 million euro loan in December in order for the carrier to pay off some of its outstanding debts. The European Commission has requested information concerning state aid granted to Montenegro Airlines as part of its restructuring process over the past three years from Montenegrin authorities.

47 comments:

  1. The war of two factions in DPS (the only party that has ever ruled Montenegro) continues. Ones are loyal to the current management, the others to former management. Each of them have filed corruption claims against each other. Daliborka Pejovic is being investigated for fixing public tenders, the past manager Djurisic is being investigated for terms of Embraer lease and covering up millions of EUR he made in losses. This is probably another tactic by Djurisic's side.

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    1. Current management of YM (Montenegro Airlines)consists of : waste manager , waiters, policemen, journalists...So they employed more than 200 new persons in YM thinking that EY will buy YM and then these newcomers will be paid by "buyout" .Meanwhile they did a lot of commercial mistakes (like route Vienna - Tuzla ,when they promised 200.000 pax for 15 flights )they changed 6 executive directors...Finally they spent 11.2 milion euros from the State aid for extra payments party stuff called DPS

      http://volimpodgoricu.me/2015/10/12/daliborka-sekretarici-dala-platu-1-165-eura/

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  2. I don't get what the prosecutor is investigating exactly. Are codeshares or partnerships not allowed?

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    1. Maybe a certain individual is trying to profit from this agreement? That is the only thing I could think of.

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    2. Usually code share agreements is done by employees from company .This one is not done yet and they paid for this "service" 50.000 EUR to company owned by Serbian ex finance minister Dinkic. Understand now ?

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    3. They paid Dinkic EUR50,000 to make them a codeshare deal with Etihad ? Wow, talk about milking the cow.

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  3. I think there is a huge battle going on within Montenegro Airlines with many opposing Etihad influence as everyone has employed wives, husband, boyfriends, girlfriends, sisters, brothers and kumovi. They know part of this will have to stop if Etihad comes in and that's where all the problems begin.

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    1. I think so too but I think it's more of a battle within DPS. One want to let MGX go down the drain, they are advocating for more competition, bringing low costers, others want the status quo, the third want MGX to stay but with a different leadership structure.

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  4. Maybe the Montenegrins were informed that YM will not be purchased by EY or JU so they are throwing a hissy fit. Then again, EY has had almost no luck turning around any of their European airlines. The last thing they need is another failure... especially with AB getting closer to going straight out bankrupt.

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  5. It is also quite interesting that Etihad was close to buying Air Malta. Even the Maltese government was saying how everything was nearly done and now all of a sudden there has been nothing for months. Etihad isn't a charity I guess.

    As for YM this is probably something internal and politically motivated since it is really silly that someone is investing a codeshare agreement.

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    1. Etihad is growing at a very slow pace compared with all the other airlines in the Middle East.
      It is really feeling the pressure from Qatar and Emirates.
      Plus all the financial troubles that Air Berlin and Alitalia are having.

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    2. Exactly! They are literally sandwiched between Qatar and Emirates and to make things even worse, their idea about investing in failed airlines isn't really paying off. The only success story so far was JU.

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    3. Who knows if JU will be making money after all the subsidies stop. Time will tell. Maybe Etihad will eventually pull away from JU. I am not saying that this will happen. We will have to watch.

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    4. If they are still fighting for AB then they will not walk away from JU. However, once the subsidies run out, it will be interesting to see how they play with numbers so as to cover the losses.

      Let's hope their JFK flights start bringing in some serious money soon.

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    5. Air Seychelles also turned out quite a success. And Jet seems to be on good track so far.

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    6. And maybe they will do scenario like in Darwin. 80% fleet cut, 90% routes cut, 70% work force fired.

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    7. Unfortunately for you it doesn't seem to be going that way.

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    8. If you are a powerful EU player whose interest is negatively impacted by Montenegro Airlines getting more aligned with Etihad or Air Serbia, would you not want to see a process that could stop or reverse that alignement? As French would say if you are looking for cause, cherchez la femme!

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  6. Air Serbia & Montenegro, Macedonia, Bosnia & Herzegovina

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    1. Da, kada bi bilo malo više pameti a manje politike.. Uz pomoć Etihada napraviti balkanski SAS

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    2. Balkanski SAS bi upravo podrazumevao malo više politike, a malo manje pameti.

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    3. Balkan nije zreo za Balkanski SAS.

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    4. Balkan je zreo ali oni kojima je u interesu da Balkan nema snaznu avio kompaniju ne zele da se to dogodi. Kome nije u interesu da Balkan ima svoju uspesnu avio kompaniju? Zna se!

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    5. Mislim da si preskočio barem jedan sloj, i to je narod. Nismo mi još spremni za ovako nešto. A i politički nulta ideja. Eto, tako je.

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    6. Anon 6:26,

      Znaju oni ko su, prepoznaće se sami, nije tvoje da o tome govoriš. Tako nekako?

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    7. U EX YU nema vise mesta osim jednog Huba i Jedne legacy carrier tako da od toga nema nista :
      INN-NS

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    8. Ovde sam čitao komentare da narod nije spreman kad je Air Serbija najavila let za Tiranu, pa onda isto kad je najavljen let za Zagreb. Narod su potrošači. Ako odgovara cena i destinacije, narod je spreman kao što su ove rute dokazale i kao što će nove rute dokazati. Nije nikakva tajna kome Balkanski SAS ne odgovara, ne odgovara LH i onima koji su uz nju.

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    9. Ma gluposti. Što Balkanski SAS može donijeti Hrvatskoj? U najboljem scenariju feedanje Beograda, kao za vrijeme Jugoslavije. Croatia čak i kad je ovako šugava kakva je daleko je bolja opcija nego Balkanski SAS dirigiran iz Beograda.

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    10. 'feedanje' a joj.

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  7. Was there actually a deal there? Do we know any details on it?

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    1. They are giving MGX strategic advice and made some codeshare deal obviously.

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    2. They really didn't say anything new, they just proposed to deepen ties with Etihad partners. Basically money was wasted.

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  8. The prosecutor should investigate Montenegro Airlines for about everything possible - financial mismanagement, cover-ups, nepotism, leasing deals, debt etc this should probably be the last thing.

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  9. They want to investigate something which is a normal commercial everyday deal between airlines, yet didn't see fit or reason to investigate financial mismanagement, especially under-reporting of financial statements.

    Just great...

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  10. It's interesting because in the law it says the Special Prosecutor is in charge of fighting corruption, organized crime and terrorism.

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  11. OT: Edelweiss Air to start Pula - Zuerich flights from 25. June.

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    1. Is that low budget airline? Not good news for OU.

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    2. not really, usually Edelweiss flies with codeshare Swiss.
      in other words it's a leasure route of Swiss.

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    3. Which will be in code-share with OU. Good news for OU!

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    4. Bravo Hrvatska!

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  12. OU pojačava liniju Zagreb-Atena via Dubrovnik iz 3 rotacije tjedno na 6 rotacija tjedno, tj. svakim danom umjesto petka.
    Žestoko je OU krenuo ove godine :D .

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    1. Pa i vrijeme im je da nesto konacno pocnu raditi. Bar preko ljeta, kad im je udarno.

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    2. Neznam otkud toliko putnika kad OU i Aegean lete, ali neka neka... Nadam se da je ZAG-ATH uskoro nova ruta.

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    3. Nadam se da će Aegean uvesti Zag-Ath, pa da uzima putnike za Cairo, a usput bi OU mogla po povoljnim cijenama mogla nuditi Grcima neke jeftine letove recimo za LHR, Paris itd. Ali ne znam koliko je OU sposoban za takvo što, no vidjet ćemo.

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