LOT Polish Airlines and turnaround fund 4K Invest, which owns Adria Airways, have reportedly expressed interest in taking a stake in Croatia Airlines. According to local media, the two are pondering at the prospect of becoming the Croatian carrier's strategic partner, as the government seeks to privatise the airline for a second time. Last week, the President of the Croatia Airlines Supervisory Board, Zlatko Mateša, hinted at Polish interest in the carrier, noting that a European partner would be ideal as it could take over a majority stake in line with European Union regulations. LOT currently maintains double daily flights between its hub in Warsaw and Zagreb, as well as seasonal services to Dubrovnik, Split, Pula and Zadar.
The Polish carrier recently expanded its operations in the region, commencing flights from Budapest to New York and Chicago, which will be followed up by services to London City next year. The airline's CEO, Rafał Milczarski, noted that the airline will be focusing on the Balkan region, which could see similar expansion in the future. Notably, emphasis will be put on cities in the area which serve as hubs for Star Alliance member airlines with whom LOT can cooperate. Both Zagreb and Ljubljana are home to national carriers which are part of the alliance, while Croatia Airlines and Adria Airways codeshare on LOT's flights from their respective hubs to Warsaw.
On the other hand, 4K Invest was linked to the potential acquisition of Croatia Airlines back in April. 4K acquired Adria via its subsidiary AA International Aviation Holding in March 2016 through a recapitalise-and-sell procedure for 100.000 euros and an additional one million euro capital injection. It later purchased the remaining shares. As part of the deal, the Slovenian government provided 3.1 million euros in capital. 4K Invest is a leading European restructuring fund registered in Luxembourg and managed out of Munich. All of it ́s subsidiaries, including AA International Holding as Adria's parent company, are completely owned by European investors, mostly German nationals.
Croatia Airlines will seek a privatisation consultant in the coming weeks. The Croatian Minister for Sea, Transport and Infrastructure, Oleg Butković, said, "Croatia Airlines needs to find a strategic partner and we will commence this process. We have held talks with the company's management several times. As far as I am aware, a tender for the selection of a privatisation consultant will begin soon. They will give us answers to questions such as how, when and in what way the procedure should take place". He added, "This year is crucial in our search of a strategic partner".
Comments
This is stupid, the government better not sell than to create such a situation.
I bet LO would remove most Airbuses and switch them to Embraers to fly to just a few European destinations. All Scandinavia would be routed via Poland.
Wonderful .. not.
Nordica is company with 18 planes in fleet (6 ATR72, 2 CRJ700 and 10 CRJ900) so it is bigger than Croatia.
The most organised and punctual airline in the world.
We can learn a lot from RIX.
OU can gain a lot from LOT opening a US flight from ZAG
Other markets can be taken care of by airlines such as LH, OS, JU, A3, TK, KL, LO...
Croatia is much more superior to Hungary when it comes to airports and airlines.
really? leading? really?
Sorry but you can't compare the two. There is a reason why LO went for BUD.
https://tangosix.rs/2018/19/06/kolumna-alena-scurica-radi-li-adria-pametno-ili-ne/
But that does not mean 4K has no interest in it, and could not do that for Lufthansa or to show like it is profitable business (as they made first year of Adria profitable with 8 million EUR injection for name) to sell it to some other.
Main point is that 4K is not here to develop business and really grow company but to sell it as soon as possible or to close it like they did with much bigger companies than Croatia is.
1) every time there will be negotiations with unions/state interest, 4K can now creditably threaten do "pull another Darwin"
2) they will very likely fly those Saabs anyway; just lost a few months; and probably even saved may euros in the process...
No they're not bigger than Croatia, they have more planes, well leased planes.
OU owns much of its fleet, perhaps not smartest thing OU did. Leasing the aircraft for 10-15 years is much better for a start up airline.
If OU leased all its airbuses from a word go, they'd be making good profits now and perhaps even have enough money for brand new A320 NEOs outright.
It is not, OU won't be sold, unless serious offer comes to the table, there's no chance of sale.
Korean air is only serious player that might buy stake in OU, they could give OU 3-4 A320 NEOs for 49% stake, the deal could happen by 2020, not earlier.
OU will need at least 16 aircraft in 2019 to cope with the demand, even with 14 aircraft now they're barely able to keep up.
Also, OU needs to hire at least 100 mechanics in Croatia, getting these right now won't be easy, as Europeans pay much better, I predict Croatian pays will skyrocket as a result of EU membership, only way to keep workers in Croatia.
Unemployment already at 7% and falling, it is expected by 2020, unemployment will be 3-4%, not good if you need to hire qualified staff, wages will need to go up significantly to keep people in Croatia.
Average Croatian NET pay is already one of the highest in central Europe @€875. Gross oay is approaching €1200.
In 2020, Average NET pay will probably be around €1000 and Gross, €1270.
Slovenia still has highest pays in Ex-Commie block, with €1090, followed by Estonia with €1050 and Czech R with €950.
Also regarding pay, we have been in the EU for 5 years already and the brain drain has only grown and grown. I'm waiting for my pay to "sky rocket" for 5 years now. Nothing.
Reality check please. I love how diaspora people have a completed twisted sense of reality.
Many theoires flying around, I cannot get them all?
a) there was some super-secret deal between LH & 4k and that 4k will make Adria a moneymaker and sell it back to LH?
b) that 4k bought adria just to bankrupt it and will get a train full of gold from LUH for that service?
c) that lizard-people are behind 4k and they bought adria just to kick out more chemctrails?
Ex-commie states, I am not compering Cro-pays to Austrian, German or Swiss pays ffs.
@AnonymousJune 28, 2018 at 1:34 PM
Your pay won't skyrocket, but hopefully it'll grow if you work for a good company, and not some doggy privatnik, who won't even pay your benefits or gives you only minimalac.
Local purchasing power in Budapest 14.05 % LOWER than in Zagreb, by official statistics. Please check your information before posting. Thanks.
DEB can be compared to INI but the figures are significantly going to change after W6 bases a second aircraft in December 2018, so maybe 500,000 which is not bad at all.
Yes, Croatia has much more airports but the biggest 3 are ZAG, SPU and DBV. The rest are very small yet.
Saabs are not useless for PSO routes which you have so many in USA, Canada, Scotland, France...
Adria negotiate to lease some of those Saabs from September. But Swiss company SkyWork made appeal to Federal court about procedure of selling those planes so they are still blocked till legal procedure will be finished.
Osim ozbiljno većih troškova za nove linije, Adrija ima i problem posada Saaba koje preuzela iz Darwina, nabavila kroz natječaje, i koje je školovala i zaposlila. Ti ljudi trenutno nemaju na čemu letjeti i svakako koštaju kompaniju iako ne lete.
Saabovi bi trebali doći u rujnu (septembru) i zamijeniti trenutno iznajmljene avione. No, plan Adrie se izjalovio. Avioni su zaplijenjeni i prodani radi namirenja obveze stečaja. Avioni su prodani Jetstream Aviation Capitalu iz Maiamia, SAD, specijalizirane kompanije za lizing turbopropnih aviona. No, SkyWork, švicarska kompanija koja je umalo doživjela sudbinu Darwina i u floti ima četiri Saaba 2000, žalila se na netransparentnost postupka prodaje. U Uredu za stečaj u Luganu odbijena je žalba, a SkyWork se potom žalio na federalni sud. Adria bi navodno dio tih Saabova od novog vlasnika uzela u lizing. No, ako postupak žalbe na federalnom sudu ne završi vrlo brzo, Adria će teško doći do tih aviona do planiranog roka u rujnu. A to znači da posade i dalje ne rade ništa, dodatni lizing tuđih aviona, dodatne troškove i prevelike avione izvan sezone i tijekom zime. Loša poslovna procjena, riskantan plan sa stečajem Darwina, planiranje operacija sa avionom kojeg u stvari nisu imali po načelu „sprema se ražanj a zec je u šumi“. Vrlo aljkavo i poprilično diletantski napravljeno. Kod nas se u ovakvim slučajevima kaže „ta svadba bu koštala“.
Train full of gold? Rally?
Lizard-people? Really?
Anonymous 1:47 Etihad plan to bankrupt every airline in Europe? Really?
If you to want to by funny OK, but really?
Look at Maldives, they only survive because of tourism (41% of economy is tourism). And I don't think most of the tourists would miss Maldivian airline.
They're not high, i am saying they're high, i am saying they need to be higher, much higher to keep qualified workers in the country. You simply can't compete with Germany when pays here are between 7000 and 14000 kuna per month for highly qualified aerospace mechanic/engineer.
Their pays must be doubled if we want to keep these highly qualified individuals in Croatia, same goes for number of other professions.
Also, 4K interest was something even a toddler could predict. I think if they merge JP and OU under a common brand (Adria?) they could go from nobody to somebody (albeit barely).
Finally, please ignore all of Purger's pessimistic rants about profits and so on - there is a bigger picture here. Corporate example - Amazon has ~$100B of yearly revenue, yet only posts slight profits of a couple mil (or *even losses*) each year. Is it to pay lower taxes? Maybe. But it is also *because they invest into growth*. The fact of the matter is, that investors see the bigger picture and believe in that company, driving the stock price up. Same could be said for 4K and JP (and OU?). Their typical turnaround time for companies is 5 years, but I think they'll stick around longer in the aviation industry. 10 years? That's definitely enough time to make JP wildly profitable.
The argument related to the number of airports is moot in this case.
As mentioned earlier, BUD is a global airport with numerous intercontinental air links. Zagreb on the other hand doesn't even have 200.000 per month outside the few summer months.
Then there is the question of cargo movement.