Croatia Airlines set for new restructuring, sale


The Croatian Minister for Sea, Transport and Infrastructure, Oleg Butković, has said the country’s national carrier will have to undergo restructuring and a fresh attempt will be made at privatising the airline once the effects of the coronavirus pandemic subside. Mr Butković said, “Croatia Airlines had issues even before Covid. Prior to the health emergency, the airline was in the final stages of securing a strategic partner. We had two very serious offers, but the pandemic halted all activities. We expect that with the return to normality, Croatia Airlines’ business will stabilise but not in its entirety. The challenge remains finding a strategic partner. If we fail to succeed, the state will be responsible”.

Croatia Airlines was last restructured between 2011 and 2015, which enabled it to receive over a 100 million euros in state aid just prior to the country entering the European Union in 2013. In the period between 2003 and 2011, Croatia Airlines generated operating losses which reached the level of the company’s capital. Liquidity problems, high level of debt, negative working capital and negative net assets brought into question the company’s operations, which necessitated the implementation of restructuring measures, reprograming loan liabilities and a capital increase. Seven years after completing its restructuring, Croatia Airlines is once again facing similar issues. It recently drafted a post-Covid strategy, which it has dubbed as a “strategy for success”, which foresees fleet renewal, increased efficiency and competitiveness. The company is also expected to benefit from a 45.4-million-euro aid package the Croatian government will distribute amongst the country’s aviation stakeholder as a way of alleviating the effects of the Covid pandemic.

Croatia’s Prime Minister, Andrej Plenković, said last September that negotiations between Croatia Airlines and Greece’s Aegean Airlines over a strategic partnership agreement would be renewed in the coming months, although this is yet to occur. Prior to the pandemic, the Croatian government set a deadline to privatise or recapitalise its national carrier by June 2020, however, the target was scrapped at the onset of the global health emergency. Aegean Airlines and Spanish regional carrier Air Nostrum had both expressed interest in acquiring shares in Croatia Airlines at the time. The Croatian carrier generated a net loss of 15.2 million euros during the first quarter of this year. Its second quarter results are expected by the end of this month.



Comments

  1. Anonymous09:02

    A joke
    Slo and cro gov should sit together and find a suitable solution. Maybe get the rights to operate to BIH as well and have united airline

    ReplyDelete
    Replies
    1. Anonymous09:11

      Why would Bosnia care about that airline when they have W6/FR now.

      Delete
    2. Anonymous09:14

      Fr/w6 is great for tourists but absolute shit for business aspect of connectivity

      Delete
    3. Anonymous09:15

      Because it still lacks flights to most European hubs. Not everyone wants to fly to German villages.

      Delete
    4. Anonymous09:15

      Ah yes because Bosnia is a massive source of corporate travel. Lolz

      Delete
    5. Anonymous09:35

      I also think that a united airline, at least for Slovenia and Croatia could work.

      Delete
    6. Anonymous09:35

      It would make sense.

      Delete
    7. Anonymous09:42

      Ann 9:15.
      You can't start growing business in your country without connections to global or local hubs. That's it. You can grow your country on tourism but when the likes of covid happens your country will collapse

      Delete
    8. Anonymous09:43

      But how are those two compatible, given the Ljubljana`s proximity to Zagreb? The hub must be in Zagreb, and what does Slovenia stand for then?

      Delete
    9. Anonymous10:03

      Secondary hub like Split and Dubrovnik. You don't even have to connect Zag and Lju, you maybe have 3x weekly do Dubrovnik and 2x weekly to Split in the summer.

      Delete
    10. Anonymous13:31

      09:14 - If you think business travellers in Western Europe do not fly Ryanair, you are totally mistaken my friend.

      Delete
    11. Business traveling - is P2P and will always be done on the shortest route possible. That's why LCY is a thing. I'm sure that for example CRL isn't used nearly as much as BRU airport, the same goes to FRA-HNN...etc.
      We'll always take the fastest and nearest route available, especially for a daily meeting - so morning flight in, night/evening flight out. With FR most of the flights are done from 9-18 which means that one-day trip just became 3 day one

      Delete
    12. Anonymous14:59

      XYZ you mentioned LCY and you think business travellers do not use LGW or STN? FR has many early morning flights and late evening ones precisely to also capture business travellers. Check out their STN flights for instance. They have a very good coverage of such flights in many EU capitals with at least 2 flights per day.
      CRL not being BRU, well yeah. But have you ever visited or used the airport itself? It is not terribly far from the Brussels centre. You also have many early morning flights and late evening ones similar to STN.
      With HHN I agree, it is a joke of an airport and definitely not FRA but can definitely be a LUX much cheaper replacement. I used the airport a long time ago and not sure if it still looks like an average Balkan bus station rather than an "international" airport.
      But with CRL and LCY vs LGW or STN, the example is not good. CRL is quite a pleasant airport and working perfectly. If not, it would've not enjoyed the traffic similar to the whole of BEG for instance.

      Delete
  2. Anonymous09:02

    Here we go again

    ReplyDelete
    Replies
    1. Anonymous11:48

      Još dva, tri puta pa penzija...

      Delete
    2. Anonymous19:30

      hahaha

      Delete
    3. Anonymous23:37

      Let hope that JU makes an offer. The combined fleets would be amazing.

      Delete
  3. Anonymous09:03

    I am betting on Garuda to be their strategic partner. They always made the most sense. I am sure this 233rd restructuring attempt will the successful one.

    ReplyDelete
  4. Anonymous09:09

    They are just going round and round in circles

    ReplyDelete
    Replies
    1. Anonymous09:11

      ...while their financials keep on going from bad to worse

      Delete
    2. Anonymous09:16

      True

      Delete
    3. Anonymous09:40

      Better that they take time with the privatisation then sell it to someone like 4K invest.

      Delete
  5. Anonymous09:10

    I'm sure there will be another privatisation advisor to be paid.

    ReplyDelete
    Replies
    1. Anonymous09:14

      It would be their third or fourth.

      Delete
    2. Anonymous09:34

      About right. They also had several restructuring advisors. For that 2012 restructuring alone they had 3!

      Delete
  6. Anonymous09:10

    Good luck!

    ReplyDelete
    Replies
    1. Anonymous09:25

      They all need it

      Delete
    2. Anonymous09:31

      *will instead of all

      Delete
  7. Anonymous09:12

    So what was the point of BCG?

    ReplyDelete
    Replies
    1. Anonymous09:15

      To waste money.

      Delete
    2. The money wasn't wasted. It was split. Like before. And like in the future, as long as OU is private playground for fully convicted criminal organization

      Delete
    3. Anonymous14:31

      Croatia Airlines should have been euthanized more than ten years ago. Its strategy and operations are among the worst in the industry, as evidenced by its financial results for years. Furthermore, the company has wasted hundreds of millions of euros from Croatian taxpayers in various forms, yet nobody seems to bear the responsibility for this! Pozdrav iz Splita!

      Delete
    4. Anonymous19:30

      +1

      Delete
  8. Anonymous09:26

    No one will touch OU with its unions in control of the Airline!

    ReplyDelete
    Replies
    1. Anonymous09:33

      Unions control OU?

      Delete
  9. Anonymous09:32

    Aegean currently owns some Romanian airline. How are they going with that? It could impact their interest in OU.

    ReplyDelete
    Replies
    1. Anonymous09:49

      Animawings

      Delete
    2. Anonymous09:50

      They just fly charters with one plane. Can't do much wrong there.

      Delete
    3. Anonymous10:06

      Is ti mostly charters to Greece?

      Delete
    4. Anonymous16:19

      Yes but they also fly to Egypt, Thailand, Morocco.

      Delete
    5. Anonymous16:58

      Animawings flies to Thailand with A320?

      Delete
    6. Anonymous19:32

      Yes, even to Mombosa, Kenya

      Delete
    7. Anonymous19:32

      They actually have 2 A320s now, not 1.

      Delete
  10. Anonymous09:33

    Looking forward to what Pozdrav has to say about this :D

    ReplyDelete
    Replies
    1. Anonymous09:48

      Pozdrav said yesterday something I completely agree with, Croatia Airlines reminds me more of more of Jat Airways in 2013.

      Delete
    2. Pozdrav is anti-Croatian, so I won't be taking any notice of anything he has to say!

      Delete
    3. Pozdrav is pro Croatian. Those who brought OU to be as it is today are anti Croatian, with full mouth of love for Croatia, and in real life doing everything to ruin it. And you are obvious product of their propaganda, absolutely not seeing what's happening around you. Or, as the second option, here to advocate your Party which destroyed both OU and the country

      Delete
    4. Anonymous16:41

      +1 Pozdrav.

      OU is just a reflection of what the country the airline is named after is. Just a huge waist of opportunity. So sad how no state owned company has done anything good in 30 years of independence and how no one is held to account for the failings.

      OU still has basically the same size fleet as it did in the 90s despite tourism now being 20 times larger and airline traffic at least 10 times larger.

      This is why the state should not be the owner of anything. All those 'assets' the country owns should have been privatised and sold of years ago! The governments only roll in this sector should be to set fair and competitive taxes a good minimum wage and set laws which encourage competition.

      Maybe one day we will see all those corrupt Politian's in the Croatian Sabor brought to justice.... maybe.

      Delete
    5. Anonymous22:01

      The problem is corruption not state ownership.

      Delete
  11. Anonymous09:36

    But will anyone be interested? All airlines are struggling and looking for 2023/2024 to start making money again

    ReplyDelete
    Replies
    1. Anonymous09:37

      shame they weren't sold to either Aegean or Air Nostrum before the pandemic started.

      Delete
  12. Anonymous09:37

    Privatization is not some magic solution to all your problems

    ReplyDelete
    Replies
    1. Anonymous09:39

      The idea is to offload a dinasour so you don't have to pay for it anymore.

      Delete
  13. Anonymous09:38

    I don't get what he means by this: "If we fail to succeed, the state will be responsible”.

    ReplyDelete
    Replies
    1. Anonymous16:43

      Last chance, last dance.

      Delete
  14. Anonymous09:41

    Lufthansa is falling apart at the moment so this might be the time to escape their grip, restructure and start running the business in your country's interests.

    ReplyDelete
    Replies
    1. Anonymous09:43

      Most of their current revenue is generated by their partnership with LH.

      Delete
    2. Anonymous09:47

      Because they have been unwilling to do anything else which would bring them much more revenue.

      Delete
    3. Anonymous10:05

      Lufthansa is falling apart???

      Delete
    4. Anonymous10:05

      Yes it is. They have cancelled thousands and thousands of flights and their on board service levels are appalling

      Delete
    5. Anonymous10:24

      I see Lufthansa Group eventually buying Croatia Airlines and integrating it into Eurowings but retaining its own brand. Same as they did with Brussels Airlines.

      Delete
    6. Lufthansa buying OU is the only viable solution, but the government will have to be prepared to sell OU for 1 euro as the company isn't worth anything . The problem is the Croatian government wants to make good money from its sale which will never happen!

      Delete
    7. Anonymous10:34

      And AF, BA, Easyjet, Ryanair, KLM didn't massively cancel flights? What is the difference to LH? London and Amsterdam are currently a complete disaster compared to Frankfurt and Munich as a hub

      Delete
    8. Anonymous10:36

      Lufthansa has not bought Adria, as many have predicted, and will not buy Croatia either. Should Croatia disappear, Eurowings or Dolomiti can easily take over the market

      Delete
    9. Anonymous10:45

      Exactly! LH is interested in OU to use it only as a feeder. Nothing more. And they would let OU to go belly up the same they let Adria.

      Delete
    10. Vlad13:42

      How is Lufthansa falling apart? They repaid their €9 billion COVID loan to the state already last year. All major European airlines have cancelled thousands of flights, that doesn't mean the airlines in question are falling apart.

      Delete
  15. Anonymous09:42

    Same story over and over with Croatia Airlines. The only exception was last year when they put up a PR show how they are going to buy new planes and expand.

    ReplyDelete
    Replies
    1. Anonymous19:24

      I really was expecting that something would come out of that.

      Delete
  16. Anonymous09:44

    Good luck. But I also agree it will be difficult to find a partner in the post corona period. As for restructuring... what's the point? Unless it is to get more aid.

    ReplyDelete
    Replies
    1. Anonymous19:25

      Well the point is for them to stop making losses or at least to reduce existing losses.

      Delete
  17. Anonymous09:45

    OU is literally at the point it was in 2011. Without more aid they will go bankrupt.

    ReplyDelete
    Replies
    1. Anonymous19:24

      That is why they are getting more aid. It's mentioned in the article.

      Delete
  18. Anonymous09:47

    They didn't get privatized but do remember that OU got 33 million euros in state aid in 2019 (two tranches) precisely so it could be successfully privatized...

    ReplyDelete
    Replies
    1. Anonymous10:05

      It got a lot more aid after that.

      Delete
  19. Anonymous09:56

    All exYU states should establish new JV airline called Southeastern. Albania can join too!

    ReplyDelete
    Replies
    1. Anonymous10:07

      Even SAS don't go well, why would this work?

      Delete
  20. Anonymous10:08

    Will not happen. Like Air Malta, there will always be an excuse. Too sweet as a toy for their politicians to employ their supporters and families. In Frankfurt OU was a real family business with couples „working“ there!

    ReplyDelete
  21. Anonymous10:20

    What will happen if this privatisation attempt also fails?

    ReplyDelete
  22. Anonymous10:21

    In the end nothing will happen as usual.

    ReplyDelete
  23. Anonymous10:21

    Same old story. They are repeating the same thing and nothing comes out of it.

    ReplyDelete
  24. Anonymous10:46

    A right investor with a vision could do wonders with the company. I think OU has a lot of potential.

    ReplyDelete
    Replies
    1. Anonymous10:53

      Croatia had and has the potential for a good national carrier, but unfortunately the government did nothing to develop the airline.

      Delete
    2. Anonymous11:59

      Aegean is the investor with a vision and they know a lot of things about summer tourism. I believe they can make OU pretty strong.

      Delete
    3. Hey, people, watch your mouth! Keep silent! Both OU and Adeze are perfect. Everything is like in dream. If you dare say anything else you are anti-Croatian

      Delete
    4. Anonymous14:35

      CROATIA AIRLINES : Pozdrav ......It's you again !!! BORING !!!

      Delete
    5. Me being boring will not change the fact Kradeze destroyed both OU and Croatia as a country. All your yelling about that just shows how much you are upset about me speaking the truth, shows who you really are and why are you here.

      Delete
  25. Anonymous10:54

    They should have started the first year after restructuring ready with a new owner and fresh capital. Instead they just prologued the "business as usual" policy.

    ReplyDelete
  26. Anonymous10:54

    The saga continues.

    ReplyDelete
    Replies
    1. Anonymous15:16

      The agony continues.

      Delete
  27. Anonymous10:56

    Lets hope Aegean returns its their best choice.

    ReplyDelete
  28. Anonymous11:45

    OU being sold to anyone would definitely increase competition in the region

    ReplyDelete
  29. Anonymous13:28

    I still wonder why OU is focusing on SPU only when they had a pure chance to comfortably base a plane in LJU. Why are they sleeping? They can very easily operate from Slovenia and enjoy their EU passporting rights. They should also consider working closer with Iberia or TAP and increase their presence in the Iberian market. So many lost opportunities.

    ReplyDelete
  30. Anonymous14:40

    I think bankruptcy is more likely than finding a new owner.

    ReplyDelete
  31. Anonymous15:15

    Why must CTN be privatized?

    ReplyDelete
    Replies
    1. Anonymous15:23

      Because the government can no longer keep giving it money while the company continues to generate losses.

      Delete
  32. Anonymous15:32

    Privatisation once again? How many times? Oh this is jatovanje, OU style!

    ReplyDelete
  33. Anonymous19:14

    No one will buy an airline. They are all waiting for weak airlines like OU to fail so they can take over the market.

    ReplyDelete
  34. Anonymous19:15

    If they privatize it, I hope they privatize the entire company. The worst thing to be to start selling OU piece by piece until the actual airline is worthless

    ReplyDelete
  35. Anonymous19:24

    A proper restructuring of the company wouldn't be such a bad idea.

    ReplyDelete
  36. Anonymous07:22

    Propali da Bog da

    ReplyDelete

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