The interest for airBaltic shares is now quite notable, mainly from investors that are well versed in the market of the Baltic Sea region, bnn-news.com reports. «These are financial investors and airlines of other countries,» says Chairman of Prudentia Karlis Krastins. He did, however, decline giving any information regarding the possible price of the airline’s shares.
According to him, now is «the right time to start motivating potential investors, because an active business season is beginning». Experienced strategic investors are at an advantage here. However, financial investors cannot be ruled out from discussions, Krastins said in an interview to Diena.
More pessimistic experts are saying that hopes to find a strategic investor for airBaltic might be exaggerated, because the interest of potential investors is not big, while their choice options are quite wide. This is because a number of other «medium» European airlines are also seeking strategic investors: Polish LOT, Czech Republic’s Czech Airlines, Romania’s TAROM, Portuguese TAP, Slovenia’s Adria Airways, as well as Montenegro’s Montenegro Airways – this is not even a full list.
Investor attraction is even more pessimistic given the national airline’s unclear history and strategic plans for the future. The overall situation with the industry in Europe is not helping the situation. For example, Financial Times, with reference to the International Air Transport Association, predicted clear losses worth 1.1 billion dollars for the industry in 2012, as well as more than modest net profit – 0.5%.
This situation noted due to several factors. One of them is the high fuel prices, the second – Eurozone crisis, as well as the necessity for every airline to follow EU regulations regarding exhaust fumes. There is also the condition that EU state governments no longer have the rights to give airlines direct support. (The last point, for example, led to Hungary’s Malev airline’s collapse.)
It was reported that investor searches for the Latvian national airBaltic airline began: Ministry of Transport published an announcement in Financial Times and British publications offering investors to give their offers for the purchase of airBaltic shares until November 1, 2012.