Zero interest in 49% stake in Croatia Airlines
The Croatian Ministry for Sea, Transport and Infrastructure has officially confirmed it has not received a single offer for the purchase of a 49% stake in Croatia Airlines. The result comes after a month long tender process and assurances from Garuda Indonesia it would take part in the procedure. "Early next year, when we announce the second round for initial offers after publishing the airline’s 2013 financial results, there will be interest in Croatia Airlines", the head of the ministry, Siniša Hajdaš Dončić, says. He adds that the expiry of the thirty day deadline late on Wednesday, with no bids in the first round of tender procedures, was "nothing dramatic".
Originally, it was planned for the privatisation process to be carried out through two separate tenders. The first called on parties to express their interest while the second was to outline precise sale conditions. On the other hand, the government also said it has a “Plan B” should the privatisation process fail and it includes selling the company’s assets one by one. Warning signs that interest in the Croatian carrier was low were apparent at the China summit with sixteen Central and East European Countries in Bucharest earlier this week where Croatian officials pitched Croatia Airlines to Chinese investors.
Despite the initial failure to find any potential partners, Mr. Hajdaš Dončić says the airline, which will post its first profit in six years at the end of 2013, will be more appealing due to its stronger financial performance. The lead of up to the tender procedure was marred by media coverage of the airline’s safety record following a spate of recent incidents, which the carrier says was an orchestrated attempt aimed at hurting its privatisation chances. For the time being, Croatia Airlines will continue with its restructuring program which is scheduled to last until 2015. Recently, the airline’s CEO, Krešimir Kučko, said the carrier has a clear development plan regardless of whether it gets a new part owner or not.
Well, those this is unfortunate I can't really say that it's totally unexpected. Selling the airline's assets is plain stupid and it has never worked in the past. It only prolong the suffering of the airline. I fear that at this point CA is as good as dead. :/
ReplyDeletejust shows how much you know about Croatia or Croatian Airlines.
DeleteFor your information, there was never appetite for some other airline to take over OU, also this process lasts around 18 months, we are the very beginning of the process.
Also Croatia Airline is now making profits and will do ok as long as it continues to sort its mess out, possibly paying all its debt with in next 3 years.
However, there are 2 major Croatian based consortium groups that wish to buy in to OU, one wants to pay back 100 million euro + invest substantial amounts of money in to the airline and other has similar deal but its not an airline but asset management firm, first consortium is travel and tourism based holding, with major interested in hotel, assets and finances.
One firm is based in Zagreb, other is based in Italy or Spain, forgot which one now. Both are strong on Croatian market and both are now talking to the Government, but nothing is certain yet, only one came out public with their plans for Croatian airlines which sees OU expanding fleet to 20 aircraft and paying its debts, with some guy from Lufthansa coming and taking over OU's management and running of the airline.
In either case, Croatia is fine and will be fine no matter what.
I am sorry but I do not agree with you. Maybe they will do fine for the time being but in the long-run they will suffer- primarily because Lufthansa is not interested in backing them and keeping them alive the same way they did with Swiss, Austrian Airlines and SN Brussels. Croatia Airlines will end up sandwiched between growing Air Serbia and a dangerous Austrian Airlines which will make their survival more difficult not to mention that their local market will be served by more and more airlines. Since OU doesn't have a concise business strategy their demise will come soon. They need someone bigger to back them, they need the same scenario that Jat Airways got.
DeleteDoes anyone know if ZAG employees are going back on strike in two days?
ReplyDeletehttp://exyuaviation.blogspot.com/2013/11/court-bans-zagreb-airport-strike.html
DeleteYeah but there were cases where the court banned strikes but they still continued. That's why I was wondering what will happen. Knowing how aggressive their unions are I am sure that's not the end of the story.
DeleteThe strike has since been declared unlawful so it’s doubtful anyone will risk getting arrested by organising further industrial action
DeleteNope, they're not, they're prohibited from striking by order of courts, and its likely they' won't be allowed to strike again, not on this issue, but if they do, they'll have no legal ground for strike and could be fired on the spot and government won't be liable for any costs.
DeleteIn Croatia strikes are allowed but if they are deemed insufficient in legal stature than strikers can be fired on a sport, despite rather strict labour laws which are some of the toughest in the EU, give workers unprecedented powers and process of firing someone can take a while.
Off topic:
ReplyDeleteI hope Darwin Airlines fix their map of ex-Yugoslavia before they launch flights to Zagreb and Belgrade. Or maybe the map was revised purposely to flatter Serbs and Croats. :D
http://www.darwinairline.com/en/carte/carte.html?skip=1
Hahaha this OFF TOPIC is the best I've ever seen! It really makes me wonder if we have some lil' "yugo" sitting there in the Darwin marketing department playing small jokes lol !
DeleteWell, they did not specify the name of the large country next to Croatia. I mean, it may not necessarily be Serbia :)
DeleteYeah but 95% of people would label it as Serbia so I guess that's that. Especially since it's the most populous out of the whole bunch. :)
Deletelol come on... that's like saying that the country on the left is Slovenia. :D But still, this is hilarious.
Deleteno worries , noone will label that bunch of countries as serbia . stay cool
Deletelol well it seems Darwin would as they will feed Air Serbia's network in Belgrade, the capital of Serbia. :D But there is no need to get offended, it was all for laughs, lighten up.
DeleteOff topic. I am currently in Armenia and look at the logo in this hotel!!! doesn't it look very much like Air Serbia....?
ReplyDeletehttp://hotelnational.am/
Hi, where are you in Armenia? I just came back from there. Write if you need any advices or contacts.
DeleteWe're as good as dead.
ReplyDeleteu're talking crap !!!
DeleteOb BTW Purger, if in 2 years time Croatia is doing fine, making good profits and is sorting out its financial situation, will you come out in Public and tell the world that you know nothing about airline business and talking out of your arse ?
DeleteSeriously, I'll hold you to this in 2 years time.
its November 29th 2013,
We see you on November 29th 2015, and i win the bet you can come out.
And what will you do if by 2015 OU ends up like Malev or gets reduced to a small MUC feeder with the fleet of 4 turboprops? Will you come here, apologise to Purger for stalking him because he dared to speak some sense, and admit that you are nothing more than a delusional nationalist who knows nothing about airline business but keeps dreaming about having an expensive toy to show off in the neighborhood?
DeleteIf that happens at any moment I will admit that I was a complete moron!
DeleteBut, keep in mind that OU will never be profitable again and they will chase their operations in the next 18 months unless they merge with Adria Airways
I'm wondering if this is a real Purger. He always backs his statements.
DeleteIf you are, can you elaborate please. What is so wrong with their finances/model? They seem to be talking about improvement in that field. Do you think this is all engineered accounting to make it more attractive toa potential buyer?
If course it is not me! It is that child thinking he is funny!
DeleteBut I also don't find future of Croatia Airlines very bright! For sure Croatia Airlines will not bankrupt, but most the most likely scenario is that LH will merge Adria and Croatia and will make them feeder for LH hubs. Same scenario was with Dolomiti, but now this company becomes too expensive for LH. And even as Dolomiti is LH company still Adria will fly on some routes from Verona, and flies on routes from PRN and TIA for LH. For sure pilots and other staff are cheaper in Slovenia and Croatia than in Italy, Germany, Austria and Switzerland.
Basically real routes for Adria/Croatia are:
ZAG-MUC
ZAG-VIE
ZAG-ZRH
ZAG-BRU
ZAG-BBI
SPU-FRA
SPU-MUC
SPU-VIE
SPU-ZRH
DBV-FRA
DBV-MUC
DBV-ZRH
DBV-VIE
ZAD-MUC
ZAD-VIE
PUY-MUC
RJK-MUC
OSI-MUC
SJJ-FRA
SJJ-MUC
SJJ-VIE
SJJ-ZRH
SKP-FRA
SKP-MUC
SKP-VIE
SKP-ZRH
SKP-BRU
PRN-FRA
PRN-MUC
PRN-VIE
PRN-ZRH
PRN-BRU
TGD-MUC
TGD-VIE
TIA-FRA
TIA-MUC
TIA-VIE
TIA-ZRH
ZAG-SPU, not more than 2 flights per day
ZAG-DBV, not more than 2 flights per day
...and some flights from destinations like Verona.
But for sure they will do the same scenario as in Dolomiti and will terminate flights from ZAG/SPU/DBV/LJU to CDG, AMS, CPH, LHR, BCN, FCO, PRN, SKP, SJJ.
Of course today you can not be sure in any scenario, as air business changes every minute, and in 5 year changes are huge (just 15 years ago there was no alliances, 20 year ago no LCC), but that scenario is defiantly most likely one.
So if I understand correct the big European Cities they will not fly on .Where the real business is at the moment. To put Adria in the same basket as Croatia Airlines .Sorry just one thing Adria cancels most of its flights Croatia Airlines doesnt
DeleteIs there any point to host the second round of applications if there was no reply for the first round? It just sounds like a waste of money and time. Why not start with the restructuring process right away?
DeleteThat scenario was forced in Dolomiti in 2001-2003. They did not care a second to cancel all flights from Verona to London, Paris, Amsterdam, Madrid, Brussels... In just few months most of those lines were again on by other companies, but Lufthansa did not care. Their only goal is to feed their hubs.
Deletewhat is the % of transfer pax on SKP-ZAG flights ?
Delete"PurgerNovember 29, 2013 at 2:28 PM
DeleteIf that happens at any moment I will admit that I was a complete moron!"
OK Purger, I'll hold you to this, November 30th 2015 Croatian airlines is in the air, doing ok, no major crisis and making profits, you'll come to this blog, but also on your youtube site and in your magazine quite my posts and tell everyone that you've were wrong about Croatian Airlines and I was right.
If you want to call yourself a moron entirely up to you, but I expect you to retract all your comments in this regard and apologize for making assertions and spell doom and gloom on Croatian airline sector.
But you must quote me, word for word in your magazine articles and in your youtube Chanel, for its only fair, and you'll know Its me cause I'll refer you this post and other posts in which I opposed your gloomy predicaments for Croatian Airlines.
Luftansa have bigger problems in hand .to start off they are not the bigger and most important airline in Star Alliance that is Turkish Airlines and not talking about the competion from Darwin Airlines in the Balkan .finaly their dominance coming to a end
ReplyDeletePurgeru, što misliš da bi se dogodilo s domaćim linijama ako se OU ugasi? Bi li ih obavljala Lufthansa ili netko treći?
ReplyDeleteNebi... nešto bi preuzeo Trade Air, ali samo ono što je komercijalno (SPU-ZAG 2 puta dnevno, DBV-ZAG 4 puta dnevno), te ono što bi plačala država kroz subvencije. Bez subvencija linije ZAG-ZAD-PUY, ZAG-OSI, OSI-SPU, OSI-DBV, RJK-SPU-DBV i ZAG-BWK nemaju financijske logike.
ReplyDeleteLH bi prije pokrenula letove iz PUY, ZAD, SPU i DBV za MUC, te SPU i DBV za FRA nego bi pokrenula domaći promet.
Not too optimistic that OU will be sold. Her future is as a feeder for LH and this is fine as long as keeps them profitable but I would love to see a move towards Dubai and Moscow.
ReplyDelete"You can fool all people some of the time, and you can fool some people all of the time, but you cannot fool all people all of the time"
ReplyDelete