Saturday, June 10, 2017

Montenegro to put airports up for concession


The Montenegrin government has outlined plans to put its two international airports, Podgorica and Tivat, up for concession after it was unable secure a loan with the European Bank for Reconstruction and Development (EBRD) for the expansion of Tivat Airport. "Several well established companies have already shown serious interest. We are currently working on preparing a concession model with the World Bank and I believe this process will be completed swiftly", Montenegro's Prime Minister, Duško Marković, said. He added that the concession is vital in order for Tivat Airport to follow through with its plans to build a new passenger terminal, extend its runway and overhaul its taxiways.

The EBRD was set to approve a fifty million euro loan for the development of Tivat Airport in the coming weeks, however, it requested for the Montenegrin government to guarantee the airport would remain in state hands over a period of ten years following the completion of the expansion project. Mr Marković's administration was unable to agree to such terms. "We are undergoing fiscal consolidation and each new debt makes it harder for us to achieve our strategic goal of macroeconomic and financial stability", the Prime Minister said. Montenegro's opposition parties have slammed the government's concession plans, noting that operator Airports of Montenegro is one of the country's most profitable public enterprises.

The government is yet to decide whether both Podgorica and Tivat will be offered to investors as part of a package or whether the two will be put on the market separately. Other details are also being determined. Montenegro Airlines could also be offered as part of the deal. Several years ago both El Al Israel Airlines, as well as Turkish Airlines, expressed interest in purchasing a stake in the Montenegrin carrier if it were given control over Podgorica and Tivat airports. In late 2014, the French concession and construction company Vinci expressed interest in establishing a partnership with Podgproca and TIvat. The CEO of Airports of Montenegro, Milovan Djuričković, who has run the company since 1999 but is believed to be on his way out, recently spoke out against attempts to privatise the two airports. “There can only be three reasons for privatising a company. One is if the management is bad, which isn’t the case, the second is if the company is unable to finance further development and lastly if the government is strapped for cash. An airport is of strategic importance to a country”, Mr Djuričković said.

65 comments:

  1. Fraport, are you reading this?

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  2. So another one bites the dust. Now we have under concession or privatization Zagreb, Ljubljana, Skopje, Pristina, Maribor, Portoroz, Ohrid and soon Belgrade.

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    Replies
    1. Sad really.

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    2. Sad only for well connected employees in these airports who will no longer have a very good paying and zero accountability job.
      For the economies of these cities though its fantastic news!

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    3. Only sad for Djurickovic's cousins and nephews!

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    4. Sarajevo, Dubrovnik and Split will be the only bigger airports left for concession.

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    5. Dubrovnik and Split definitely won't be put for concession.

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    6. Oh yes they will

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  3. "There can only be three reasons for privatising a company. One is if the management is bad, which isn’t the case, the second is if the company is unable to finance further development and lastly if the government is strapped for cash. An airport is of strategic importance to a country"

    I would say all of the above in this case.

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    Replies
    1. Hahaha I thought the same when I read it.

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  4. I think these two airports have a lot of potential but Tivat can no longer grow without a new terminal. A real shame we won't see any construction there any time soon.

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    Replies
    1. Tivat is a mess during the summer. Expansion is long overdue.

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    2. Unfortunately, it is now unrealistic for them to start until 2018 and by the time they finish it will be 2020.

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  5. Fraport or Vinci would be great.

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  6. The best thing about this is that Djurickovic will be gone after 18 years with half of his family which work at the airport.

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    Replies
    1. And all of his 'great' advisors,consultants...They should go with him!

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  7. Very interesting to see what all of this will mean for Montenegro Airlines.

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    Replies
    1. They will actually have to pay off their debts and airport fees.

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    2. If they offer MGX and the airports in one package they would kill two flies with one stone.

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    3. I don't know any airline that is also an airport operator.

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    4. Prag airport and CSA

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  8. We already have French, Chinese, Turks and Germans running airports in ex-Yu. Let's see who comes next.

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  9. They should also think of expanding Podgorica. I was there last year, the airport is so small and they don't let you go through passport check into the departure lounge until an hour before your flight because there is nowhere to sit.

    Also the mafiosi deal they have with the taxi company is crazy. Only one taxi company is allowed to drive you from the airport and they charge a fixed rate of 15 euros to the city. You can go with any taxi company back to the airport and the actual price from the city is just 6 euros.

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    Replies
    1. You can take the train, costs like 1 EUR.

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    2. I think Podgorica is the only ex-Yu airport with direct rail access. Great advantage.

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    3. Nis also has rail going right next to it but I'm not sure if its passenger or freight.

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    4. to Anon 10:12 AM
      You can register here and order cab via internet http://www.web2taxi.me/desktop_login.php (airport has free wi-fi)

      and you pay 5/6 euros to downtown ride

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    5. Thanks Milivoje. Didn't know that.

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    6. The terminal looks nice from the outside though.

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  10. Good news for Montenegro. These airports should definitely get a professional management.

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  11. What price could they get?

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    Replies
    1. It depends on the period the concession is given.

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  12. I would not be surprised if they falsified their financial reports like Montenegro Airlines.

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  13. What are the passenger results for Podgorica and Tivat airports this year?

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    1. I don't know for Podgorica, but here are Tivat's results:
      http://www.exyuaviation.com/2017/05/tivat-airport-numbers-grow.html

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    2. Podgorica had 24% yoy growth (Jan-Apr). I am interested to know the exact numbers as well. Sadly The Airports of Montenegro stopped updating their statistics after January.

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    3. Podgorica JAN-APR: 226,082 +25.4%

      JAN: 50 799 +23.4%
      FEB: 46 738 +18.8%
      MAR: 56 052 +22.1%
      APR: 72 493 +37.1%

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    4. wow fantastic results for TGD.

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    5. So combined Podgorica and Tivat had 317609 in first four months.

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  14. They should sell it to SHS Aviation, the guys that run Maribor Airport. They could turn the airport into a hub for Chinese passengers :D

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    Replies
    1. Haha good one.

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    2. On a serious note there is bound to be interest from the Chinese.

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  15. Russians also in the past wanted to get concession of Montenegro airports.

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    Replies
    1. With the current political situation, I don't think they will be interested anymore.

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    2. Or rather the opposite :D

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  16. Hope they get a good price.

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  17. OT: http://www.index.hr/mobile/clanak.aspx?category=vijesti&id=976036

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  18. I think this would be a good opportunity for TAV to expand its portfolio in the Balkans.

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  19. Do we actually know Airport Montenegro finances. Revenue? Profits?

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    Replies
    1. 4 million euro profit in 2016.

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    2. Thanks, not bad.

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    3. And how much does MGX owe to the airport?

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    4. Over 19 million EUR!!

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  20. State will have to find a solution for YM before it makes an airport transaction. YM owes millions to the airport and has no way to repay them. State owned airports don't care that much because they are all part of the same family but trust me a foreign operator will.

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  21. The government has apparently agreed to extend Djurickovic's term until 2018 even though he was supposed to be replaced. So he will likely stay on until the concession is completed.

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  22. Good move. Hope they do the same with the airline.

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  23. OT: No kiosks at BEG? New BEG check-in area had self serve kiosks planned, in yellow:

    http://bit.ly/2s8JUdg

    but they don't exist in actual photos:

    https://ibb.co/jQTS0v

    What happened with kiosks?

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    Replies
    1. Have you maybe thought that they haven't put them up yet? They have purchased them. You can see it on the tenders page. That part opened less than 24 hours ago.

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    2. No, but I thought why wouldn't they put up at the same time as the check-in desks. They did in Zagrab. What happened to bag drop machines, they are also missing?

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    3. You have several self check in kiosk throughout the airport. They have been in use at least for a year.

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    4. Those kiosks don't work for Air Serbia.

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  24. .... We will give you the money but it has to stay under country's ownership. That is exactly what these people don't want, they want to fix it and sell it quick, also hiring hundreeds of employees (cousins etc.) for the company looks big when someone isslooking to buy it.... why We always think that the world beyond our borders is stupid ??

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