Croatia Airlines to be sold within nine months

Croatia Airlines’ privatisation process kicks off

The Croatian Ministry for Sea, Transport and Infrastructure has announced it expects to see Croatia Airlines’ privatisation process completed within six to nine months. The Croatian carrier will become the first state run company to be sold under the new assets management law. The ministry says the airline’s privatisation process has effectively begun and its value is estimated at approximately 39 million euros. A proposal for the sale of Croatia Airlines is expected to be drafted within the next two weeks. Following government approval, an international tender for the sale of the Croatian carrier will be launched.

The Minister for Sea, Transport and Infrastructure, Siniša Hajdaš Dončić, has previously said the government will sell a 49% stake in the airline if the buyer is from outside the European Union, while more shares could be sold in case an EU investor comes along. So far, Garuda Indonesia is the only airline to have officially confirmed its interest in purchasing a stake in Croatia Airlines. The government has held talks with officials from both China Southern Airlines and Hainan Airlines as well. Etihad Airways and Turkish Airlines, which have both been linked as possible strategic partners, have denied interest in the Croatian carrier.

Meanwhile, Croatia Airlines is continuing to deal with the fallout of its most serious emergency from two weeks ago when one of its Bombardier Dash 8 Q400 aircraft landed without its nose gear. A further four incidents involving Croatia Airlines aircraft have occurred since, three of which were on the Dash 8s. While the incidents were minor, all have been reported by the Croatian media. The most recent incident, which occurred yesterday, involved the airline’s Airbus A319 scheduled to operate the service between Zagreb and Paris. The jet was forced to return to the Croatian capital shortly after takeoff due to technical problems. Several opposition politicians have suggested the government and media are running a smear campaign against the carrier in the run up to its privatisation process in order to justify a low purchase price to the public. Croatia Airlines’ Chief Operating Officer, Zlatko Širac, says, “We would all be more than happy to get rid of the Dash aircraft and buy Airbus. The fact that such a move would lead us into bankruptcy doesn’t seem to interest either our pilots nor the public”.