"Major company" interested in Montenegro Airlines


The Montenegrin Minister for Transportation and Maritime Affairs, Osman Nurković, has announced that a "major international company" plans to purchase a stake in Montenegro Airlines and will soon submit its letter of intent to the government. In a statement, the minister said, "We are anticipating a letter of intent from a major company, which also owns a carrier, to purchase Montenegro Airlines. This is an exclusive announcement. I don't know the details of the offer, but there is strong interest from this investor". The minister refused to reveal the name of the company in question. It comes as the government advances procedures for the concession of the country's two international airports.

The minister added, "If they decide to purchase Montenegro Airlines, they certainly won't do so with debt", indicating that the state is prepared to take over its national carrier's accumulated debts, similar to what the Serbian government did prior to Etihad Airways' equity investment in Air Serbia. "This should be handled by the state which has allowed Montenegro Airlines to amass such debt. We will either solve this problem or liquidate the company which has been in problems since its foundation. Both options will be expensive but we will decide what's best", Mr Nurković added. Montenegro Airlines' accumulated debts amounted to almost 77 million euros by the end of 2017, according to the carrier's audited financial report. The airline, which has struggled with its finances in the past, has seen a turnaround so far in 2018 with improved revenue, increased passenger numbers and a fleet expansion strategy for the coming years.

Previous attempts to privatise Montenegro Airlines have all failed. In 2009, Israel’s national carrier, El Al, teamed up with the European Bank for Reconstruction and Development in order to purchase a stake in Montenegro Airlines. El Al was interested in the carrier only if it gained control over Podgorica and Tivat airports as well, which the government deemed “unacceptable” at the time. In 2011, the Montenegrin government offered a 30% stake in its national airline. Arkia Israeli Airlines, El Al and Etihad Airways all purchased tender documentation but never made a takeover bid. Later that year, the government announced that Turkish Airlines was close to taking over both the carrier and the country’s airports but added it would not sell its national airline at any cost. Plans to privatise the carrier in 2014 did not materialise either.

Last year, the Privatisation and Capital Investment Council of the Government of Montenegro said, "There are a number of sale models possible for Montenegro Airlines. It does not necessarily have to be privatised through the sale of shares but also through recapitalisation or a strategic partnership, depending on what would be of interest to the investor". Prior to the unravelling of Etihad Airways' equity investment strategy, it signed a Memorandum of Understanding for Strategic Commercial Cooperation with its Montenegrin counterpart. At the time, it was suggested Etihad could invest in Montenegro Airlines through Air Serbia, however, its plans never materialised as issues with its equity partners in Germany and Italy started brewing.

Comments

  1. Anonymous09:02

    Doubt it.

    ReplyDelete
  2. Anonymous09:02

    Meanwhile at OU they still haven’t selected their “privatisation consultant”.

    ReplyDelete
    Replies
    1. Anonymous10:51

      If they keep dragging their feet, potential investors will already invest in airlines around them. Time to get their act together.

      Delete
  3. Anonymous09:03

    4K invest for sure.

    ReplyDelete
    Replies
    1. Anonymous09:15

      +1

      Delete
    2. Anonymous09:16

      This is what Adria's CEO said about their financial report and it was reported here. Pay attention to the last part of the sentence.

      "The aviation industry is changing on a global level. Higher oil prices, shifting passenger habits and expectations, new business models and competition have forced Adria to change and focus on greater rationalisation measures, opening up possibilities for cooperation with other regional carriers and seeking out mutual synergies".

      Delete
    3. Anonymous09:22

      Honestly I would not be surprised if it's them. But I would be very worried if it were them seeing what a great job they did with Darwin.

      Delete
    4. Anonymous09:42

      LH/4K makes sence for Montenegro.

      Delete
    5. Anonymous09:43

      and with what money would they purchase anything?
      the last thing reported here was that they reported a loss of 5 million

      Delete
    6. Anonymous09:43

      Well YM did start 3 new routes to Germany from Tivat this year.

      Delete
    7. Anonymous10:17

      What is the basis that Lufthansa is behind 4k?

      Delete
    8. Anonymous10:25

      I believe it's just trolling

      Delete
    9. Anonymous10:53

      German influence in airline, many new routes in Germany and wet leases to Lufthansa owned or affiliated airlines.

      Delete
    10. Anonymous18:51

      I have a friend in the import-export business, and 85% of his turnover in the past few years has been with Germany.

      Lufthansa must be behind him too.

      Delete
    11. Anonymous20:40

      4K is working for LH, 100%. They always appears there where LH doesnt have their own interest but they try to exclude others. Like Croatia. 4K is there only to make problems to LOT.

      Delete
  4. Anonymous09:04

    "We will either solve this problem or liquidate the company which has been in problems since its foundation. Both options will be expensive but we will decide what's best"

    Wow what a great way to sell your company to a potential invesotr. Balkan politicians never cease to amaze me.

    ReplyDelete
    Replies
    1. Anonymous09:18

      Well at least it's honest.

      Delete
    2. Anonymous09:21

      What he wanted to say is that whoever takes over MGX will only take it with a clean balance sheet meaning the government will have to take over all debt and losses which will ultimately be payed by the taxpayers.

      Delete
    3. Anonymous21:03

      Exactly. And they should not repeat Serbian mistake by taking all debt and continued subsidies as equity partner

      Delete
  5. Anonymous09:14

    They should have taken that El Al idea when they had the chance all those years ago. I'm certain they would have been in a much better position than they are now.

    ReplyDelete
    Replies
    1. Anonymous09:17

      Would have been interesting to see what El Al would have done with them. I'm also surprised Arkia applied for the tender documents. Why was there such interest from Israel?

      Delete
    2. Anonymous09:29

      Israelis are big investors in Montenegro and Serbia.

      Delete
    3. Anonymous09:32

      Bravo Israel!

      Delete
    4. Anonymous09:33

      Ask Bulgaria about Israeli investments in their aviation sector. LOL.

      Delete
    5. Anonymous09:58

      @9.14 Why?

      El-Al would have had an absolute monopoly whereby they would control all international airports in the country country and own the majority of shares in the only airline. Who would want to do that? Montenegro would have lost big with a deal like that.

      Delete
    6. Anonymous10:50

      Having the airport and airline owned by the same private company is never a good idea usually.

      Delete
    7. Anonymous21:06

      They should keep airports and get rid of the company. Montenegrin connectivity is rising and they are on the good trajectory.

      Delete
  6. Anonymous09:15

    My guess is they were expecting Etihad to buy them but didn't expect Etihad would have the problems they have and give up on MGX.

    ReplyDelete
    Replies
    1. Anonymous09:19

      At one point their idea was for Air Serbia to takeover Montenegro Airlines, same as Alitalia taking over Air Malta. Thank goodness that didn't happen. With the CS they get the same without actually buying Montenegro.

      Delete
    2. Anonymous10:53

      Actually I think Air Serbia - Montenegro tie-up could have been beneficial for Air Serbia, but not so much for Montenegro Airlines.

      Delete
    3. Anonymous21:10

      Current deal is beneficial for JU. The duopoly is in place, codeshare guarantees feeding for JU network. If only they had that for the whole Adriatic coast.

      Delete
  7. Anonymous09:20

    Buying such a loss-making airline, with a couple of planes is totally insane.

    ReplyDelete
    Replies
    1. Anonymous09:24

      They cant sell it, since liabilities are many times higher than assets, and it is far from profit. They will give it to anyone for free.

      Delete
    2. Anonymous10:24

      Adria and Air Serbia were given for free too so I don't see why YM would be any different.

      Delete
    3. Anonymous10:49

      Croatia Airlines will be given for free as well.

      Delete
    4. Anonymous10:54

      Not only were they given for free, but each government also had to give money to the new owner.

      Delete
    5. Anonymous11:40

      GoS still does.

      Delete
    6. Anonymous21:13

      Competition for the worst deal continues. Adria - not that good. Jat - total disaster. We will see what happens with Croatia and Montenegro.

      Delete
  8. Anonymous09:24

    My first thought was Arabs ... Qatar, Emirates, Etihad ... but who knows

    ReplyDelete
    Replies
    1. Anonymous09:25

      Don't think Etihad will be purchasing airlines anymore :D

      Delete
    2. Anonymous09:26

      Actually people should take note of the wording. He says interest was expressed by a COMPANY that OWNS an airline. So to me it looks as if this is 4K Invest.

      Delete
    3. Anonymous09:49

      Milo is very good friends with the Arabs so who knows, although I would definitely take Etihad out of the equation.

      Delete
    4. Anonymous10:22

      He is good friends with Abu Dhabi ruler but we won't see Etihad investing.

      Delete
    5. Anonymous10:23

      Qatar Airways might be a potential buyer. They bough Air Italy and Al Baker said they could invest in other airlines only if they are given a clean balance sheet. MGX is a small airline and it is not a big risk.

      Delete
    6. Anonymous10:48

      Emirates said they don't want to buy any airline. Just last year they said they made a huge mistake by buying Sri Lankan back in the day and that they won't repeat that mistake.

      Delete
    7. Anonymous21:15

      They are too small for Qatar. They major operation is AIRITALY. Really hope that one succeeds

      Delete
  9. Anonymous09:27

    All of the former Yugoslav republics would sell even their underwear and pay a foreigner to buy it.

    ReplyDelete
    Replies
    1. Anonymous09:35

      Makes sense, why would anyone would give us money to take our dirty and worn out underwear?

      Delete
    2. Anonymous09:52

      Anon at 09:35
      +1

      Delete
    3. Anonymous10:21

      Good metaphor there 9.35.

      Delete
  10. Anonymous09:31

    Micro state airline like MGX will never work. Therefore linking up with another airline would be a good idea.

    ReplyDelete
    Replies
    1. Anonymous09:55

      Luxair does quite well.

      Delete
    2. Anonymous10:06

      True they had €9.5 million profit last year.

      Delete
    3. Anonymous10:21

      Ummm Luxembourg is one of the worlds richest countries.

      Delete
    4. Anonymous10:29

      Luxair used to have B747s in its fleet :)

      Delete
    5. Anonymous10:40

      They used to be owned by Lufthansa.

      Delete
    6. Anonymous10:48

      Singapore is a micro state yet...

      Delete
    7. 10.29
      True. It was "short" and smaller SP, still it was 747. And they even had 707 before as well as 767 at one point. And they used it mostly for flights to South Africa

      Delete
    8. Anonymous10:57

      You are all comparing apples and oranges with Singapore and Luxembourg vs Montenegro.

      Delete
    9. Anonymous11:21

      @anon 10:40: for a few year, LH held about 1/8 of Luxair ; not sure if they "owned" them

      Delete
  11. Anonymous09:36

    Good luck.

    ReplyDelete
  12. Anonymous09:37

    I hope both get privatized.

    ReplyDelete
    Replies
    1. Anonymous10:05

      If Milo and company get a good commission ;-)

      Delete
  13. Anonymous09:39

    I have heard a rumor that it is 4k.

    ReplyDelete
    Replies
    1. Anonymous09:41

      -.-

      Delete
    2. Anonymous09:44

      If it is, maybe those rumors that LH is behind it are somewhat true. They'll use 4K to clean all of the airlines and buy them/join them or something.

      Delete
  14. Anonymous09:42

    I bet you this "major company" is someone like SHS aviation and the airline they own is VLM.

    ReplyDelete
    Replies
    1. Anonymous09:54

      Great, Podgorica to Shanghai flights are just around the corner!

      Delete
    2. Anonymous10:05

      I was hoping more for Xian!

      Delete
    3. Anonymous10:20

      You may be joking but

      Montenegro has become the latest country in the former Yugoslavia to seek flights from China, following in the footsteps of Macedonia, Croatia, Bosnia and Herzegovina and Slovenia. Danilo Orlandić, the General Manager of operator Airports of Montenegro, which runs the country's two international airports, said, "Together with our strategic partners we are looking at significantly boosting the number of guests from China, especially outside of the summer season, which could bring us a large number of tourists".

      https://www.exyuaviation.com/2018/06/ex-yu-airports-move-to-secure-china.html

      Delete
    4. Anonymous15:07

      I'm skeptical that such "major company" announced by our politicians might be someone like SHS unfortunately.

      Delete
  15. Anonymous09:47

    I'm not an aviation expert, but i think one really needs talent to make losses of 77 million with 6 planes

    ReplyDelete
    Replies
    1. Anonymous10:02

      It just blows my mind how they managed to do this.

      Delete
    2. Anonymous10:19

      This is accumulated debt, not their annual loss, which I think was around 4 euros.

      Delete
    3. Anonymous10:19

      Sorry I meant 4 MILLION euros haha. Would be nice if it was just 4.

      Delete
  16. Anonymous09:49

    Maybe Turkish Airlines? They did invest in Air Albania after all.

    ReplyDelete
    Replies
    1. Anonymous10:18

      An airline that has a plane painted in its livery but no website, no destination network, no flights. They probably got ordered by Erdogan to do it.

      Delete
    2. Anonymous10:47

      They didn't do a great job with B&H Airlines.

      Delete
    3. Anonymous12:54

      Because of political interference.

      Delete
  17. Anonymous09:52

    Let s just hope we don t see any Russian money in Montenegro Airlines

    ReplyDelete
    Replies
    1. Anonymous09:54

      +1000

      Delete
    2. Anonymous10:47

      They would be lucky to get any Russian money for Montenegro Airlines. In fact they would be lucky to get any money at all.

      Delete
    3. Anonymous12:55

      I also don't understand why would it be problematic for a Russian company to invest in MGX?

      Delete
  18. Anonymous10:00

    The B737 in Montenegro livery is beautiful :)))

    ReplyDelete
    Replies
    1. Anonymous10:43

      Does anyone know until when does the B737 lease run for?

      Delete
    2. Anonymous10:58

      Till the end of the summer season. So late October. I think they are very happy with the way the aircraft performed for them this summer. Passengers also happy. Maltese crew are nice.

      Delete
    3. Anonymous13:10

      Then , they don't have to repaint the LH engine c-duct

      Delete
  19. Anonymous10:02

    YM ne vredi nista ima samo dugove

    ReplyDelete
    Replies
    1. Anonymous12:52

      Well it holds around 60% of Montenegrin market.

      Delete
    2. Anonymous12:55

      Which can easily be covered by any low cost airline if they dissipated.

      Delete
    3. Anonymous19:03

      O my god,where you found the figure of 60 percent?The percentage is 25%

      Delete
  20. Anonymous10:04

    They have to get rid of YM. EU has already said they can no longer give money to YM (and this year government didn't listen to them and gave money again to YM). With accession talks moving they have to get rid of the airline and will give it to pretty much anyone.

    ReplyDelete
    Replies
    1. Anonymous22:30

      Lol, you say this as if Montenegro's EU accession is super imminent. It's not even certain that the EU will keep its current members in the next 20 yrs. Don't hold your breath.

      Delete
  21. Anonymous11:01

    I wish the best of luck to Montenegro Airlines and who knows maybe an exciting future is ahead of them.

    ReplyDelete
  22. Anonymous12:51

    The only true legacy airline left in ex-Yu. Hope they find a solution.

    ReplyDelete
    Replies
    1. Anonymous12:56

      True only ex-Yu airline without buy on board.

      Delete
    2. Anonymous13:03

      I didn't know YM is a full service airline. WELL DONE!
      Flying supermarkets are getting more and more popular :(

      Delete
    3. Anonymous13:50

      Hmm that might be one of the reasons they have the worst results in ex-Yu.

      Delete
    4. Anonymous13:56

      Hmm, really?

      https://www.exyuaviation.com/2018/07/montenegro-airlines-posts-record-results.html

      Delete
    5. Anonymous14:11

      Financial results are the worst in ex-Yu. That's the one that matters. Not so much how many passengers are handled.

      Delete
  23. Anonymous13:50

    Why the bragging if he doesn't know the details??

    ReplyDelete
    Replies
    1. Anonymous14:01

      Haha so true. And he is the minister for transport!

      Delete
  24. Luke Fisher14:34

    I would actually imagine it's Etihad. Yeah some of their other investments haven't worked out, but they could cost-cut so much of Montenegro Airlines' overheads by just doubling it up with JU out of offices in Belgrade. It also gives them an almost monopoloy on the entire summer traffic from Russia to the coast, with direct or through BEG, and that's actually worth quite a lot of money. Roll a lot more via Belgrade and effectively have it as one company is probably not a bad solution for either party.

    ReplyDelete
    Replies
    1. Anonymous14:57

      That would not be a bad solution. But Etihad is undergoing restructuring and is abandoning the equity model, so buying another airline (which also happens to be struggling like all the other airline they bought) would probably not be a good look.

      Delete
    2. Anonymous15:00

      Thank the lord EY never intervened with YM because you saw how their project ended up. They poured money and money on something beautiful yet so pointless.
      YM struggled a lot, but it made it all by itself with no "help".

      Delete
  25. Anonymous15:06

    I'm very interested to see which company this is. I hope the minister isn't just talking out of his a** and something actually materializes.

    ReplyDelete
    Replies
    1. Anonymous15:12

      I personally think it's Ryanair. They are starting to collaborate with regional carriers. Air Malta, Air Europa and I think after the spectacular Montenegrin success, they decided to take a chance on a missed opportunity.

      Delete
    2. Anonymous16:28

      Ako je Ryan onda da se sutiraju u dupe od srece. Ako nije onda bolje sami da zatvore radnju.

      Delete
    3. Anonymous18:55

      "I personally think it's Ryanair."

      Please continue to impress us with your aviation expertise.

      Delete
    4. Anonymous19:40

      Why not Anon 18:55? If you go to the Ryanair website you can book Air Malta and Air Europa flights. You have combinations via Malta, Madrid. If you think about it, there is currently no destination in Balkans. Also major means something really big. Ryanair is the biggest in Europe.

      Delete
  26. Anonymous16:27

    The next step is very profitable Boeing737-600 AP version in all economy configuration for charter tourist flights from eastern airports to Tivat airport.

    ReplyDelete
  27. Anonymous17:26

    My friend that works in Montenegro Airlines say it is Qatar. There were visits between them.

    ReplyDelete
    Replies
    1. Anonymous17:51

      Prije cu crkvi(crkvama) vjerovat u zagrobni zivot,nego ministru saobracaja u vladi cg(namjerno...sve malim slovima).Postoji intresovanje 4K IF,doduse preko AA IF(Adriju su preuzeli,na papiru)...cak je i iznos slican.Bilo bi previse da da Qatar uzme MGX,iako Qatar ima ogromnu investiciju u opstini Tivat,gdje ima problema sa privatnim zemljistem....to bi bio jedini razlog zbog cega bi Qatar uletio u biznis(uz oprost dugova-vi nama rjesite zemlju)

      Delete
    2. Anonymous21:51

      Anon 17:26 is right, it is Qatar Airways.
      They have an idea of creating a prototype of the former Etihad Regional project. Details coming soon...

      Delete
    3. Anonymous01:02

      100% not Qatar. 4K.

      Delete
  28. Anonymous18:39

    Which are YM's most expensive slots? I think Belgrade and Zürich are their most profitable routes....

    ReplyDelete
    Replies
    1. Anonymous20:01

      Hm,most expensive 'slots'!? CDG, regarding slot-price:-) Sorry,joking:-) TIV-BEG,TGD-BEG,TIV-DME,TIV-CDG,TIV-MUC,TGD-LJU,TGD-FRA.... Always stand-by pax on these flts :-(

      Delete
    2. Anonymous20:24

      TGD-CDG & TIV-DME make sense, I think route to Moscow is used by rich Russians.

      Delete
  29. Anonymous19:00

    Vrlo dobro bi bilo ako Montenegro Airlines za sledecu sezonu uzme na lizing jos jedan Boeing 737-500 koji je komforan avion i uspostavi jos jedan turisticki charter let Iz Aerodroma Tivat za Belgiju.

    ReplyDelete
  30. 737-CL 300 400 500..je pravo resenje ...sva ostala resenja su PRESKUPA ...

    ReplyDelete
  31. Anonymous22:05

    Back in the days Arkia bought Balkan Airways and crashed them 1 month. First they sold their slots at Heathrow and then they sold their planes. So, ask the Bulgarians about Israeli investors in aviation LOL

    ReplyDelete
    Replies
    1. Anonymous22:44

      It was a complete disaster. PM Kostov, back in the days, sold it for the price of a Mercedes-Benz: 150,000$. One of the biggest scandals ever. The Israeli man is Gad Zeevi. LZ consisted of many Ty-154M, 733/735 and later A320 and 2 767s that flew to Johannesburg, New York, Kuala Lumpur/Singapore, Manila, Colombo and so on. African students used to fly via Sofia to other parts of Europe because the prices were dirty cheap. Tupolev quite full from Harare, Tripoli (Bulgarian workers in the days when Libya was rich).

      The successor changed names various times and finally ended up with Bulgaria Air in 2002.

      With regards to London, the flights were operated daily to Gatwick, which worked quite well as they were cheap and made convenient connections with Virgin Atlantic. At a later stage, Heathrow flights were restored and Gatwick ditched. Gatwick become so popular, that even British Airways launched flights to Varna with their old, cool 734 (leather seats in economy and white nosed plane sometimes). Free newspapers and beer. Very nice staff.

      Similar to former huge JAT, Tarom, CSA and Adria (Inex), the current FB will never be the same again as what LZ used to be like. Those days are gone, sadly.

      Delete
  32. Anonymous00:15

    Qatar airways is a good and fair company,they have a lack of cabin crew in recent years,and they chase ex-yu pilots, ground crew, and other aviation personnel to work for them, the monthly salary is excellent only 86 working hours per month ,this year at least 14 new aviation personnel has been employed by Qatar based Airline.

    ReplyDelete
  33. Anonymous20:58

    Za Montenegro airlines avion Boeing 737-400 je prevelik, Boeing 737-300 je dobar izbor ali ipak postojeci Boeing 737 serija 500 je optimalno i veoma razuman izbor i conforno rjesenje za ovu aviokompaniju ili skuplju seriju 600.

    ReplyDelete

Post a Comment

EX-YU Aviation News does not tolerate insults, excessive swearing, racist, homophobic or any other chauvinist remarks or provocative posts with the intention of creating further arguments. A full list of comment guidelines can be found here. Thank you for your cooperation.