Croatia Airlines begins search for part owner

Another EX-YU airline begins privatisation process

The Croatian Centre for Restructuring and Sales (CERP) yesterday invited investors to express interest in buying a 49% stake in Croatia Airlines, marking the start of the carrier’s privatisation process. Potential investors have until November 27 to express their interest. The tender will be followed by a second one where concrete takeover offers are to be made. The Croatian government plans to retain its 46.76% share in the airline, which coupled with shares owned by Zagreb Airport and the State Agency for Deposit Insurance and Bank Rehabilitation amounts to 50.25%. The decision to sell a minority share package allows companies from outside the European Union to take part in the sales process.

The government says the privatisation procedure is likely to last between eight and ten months. The exact value of the company will be determined during the second tender when potential strategic partners will make their offers. The government has previously estimated the company to be worth 45.9 million euros. It says there will be three criteria they will focus on when negotiating the carrier’s sale. They include turning Croatia Airlines into a regional leader, fleet renewal and the offered price.

The Croatian Minister for Sea Transport and Infrastructure, Siniša Hajdaš Dončić, said, “As many as four international companies have shown interest in purchasing a stake, including Garuda Indonesia”. Other airlines also believed to be amongst the four are Hainan Airlines and China Southern Airlines. The government believes it is unlikely a carrier from inside the European Union will be willing to purchase Croatia Airlines at such time of economic uncertainty on the continet. On the other hand, the government also has a “Plan B” should the privatisation process fail and includes selling the company’s assets bit by bit. “In its present state Croatia Airlines can’t function past 2015”, Mr. Hajdaš Dončić concluded.