Montenegro Airlines privatisation: EBRD most serious candidate

The Montenegrin ministry of transportation is preparing to sell shares and therefore privatise the country’s national airline – Montenegro Airline. Currently the most serious candidate for the privatisation of Montenegro Airlines is the European Bank for Rebuilding and Development (EBRD). This bank has hired a US consultancy company, which will provide forecasts on the dynamics on the company’s privatisation by October. According to the “CG Economist”, the ministry has chosen a US company “SH&E”, which will provide analysis of business strategy for the needs of this privatisation.

The privatisation of Montenegro Airlines will be conducted in three stages, first being the selloff of 5% of shares, second being recapitalization and the third one being the selling of a majority share-package. “The 5% of shares, which will be sold at the market, are ‘a test balloon’, which will be used to estimate the value of the company’s shares. This experience would serve as the basis for the company’s recapitalization, for which the EBRD has expressed interest”, said an official in the ministry of transportation. EBRD is also interested in the privatisation of companies “Aerodromi Crne Gore” (Airports of Montenegro) and “Luka Bar” (Port of Bar), which are also to be restructured and privatized in the near future.

Montenegro Airlines is the only airline in Montenegro. 99.97% of the company is owned by the state. With recapitalization, EBRD would become the owner of, at most, one third of the airline’s property. Montenegro Airlines recently purchased a new Embraer aircraft, the first one in its fleet of Fokker’s.