Croatia Airlines is on the lookout for a strategic partner after the carrier continued to show improved operational and financial performance in the first half of 2017, which should result in a fifth consecutive year of profit, consequently making the company more appealing to potential investors.
Krešimir Kučko, the Croatia Airlines CEO, said “We [Croatia Airlines] have worked together with consultancy firms and drafted a proposal for the privatisation process. Several airlines across the world have been contacted and we will see how the process advances. One thing is for sure, we want to find a strategic partner.“ Mr. Kučko also added, “We are not interested in someone taking over the management. We have shown that we can respond to both past and future challenges, but now we need a strategic partner to grow faster”. Mr Kučko noted that following its’ restructuring, Croatia Airlines is now a “stable and prospective company with a clear direction for future development”.
The Croatian Minister of Sea, Transport and Infrastructure, Oleg Butković, said “…a strategic partner should be found for Croatia Airlines with extensive experience in the commercial aviation sector, which would ensure network expansion and market share growth”.
The former Croatian Transport Minister, Siniša Hajdaš Dončić, recently said that a total of six companies had previously expressed interest in buying a stake in the national carrier, and has urged the country’s Prime Minister to resume Croatia Airlines’ privatization process. Lufthansa, Garuda and Hainan showed interest in buying a stake in Croatia Airlines, with two more parties from Cyprus and Greece being interested, as well. The government is expected to resume Croatia Airlines’ privatization process at the end of 2017 or in early 2018 in a bid to complete the sale of a number of state-owned companies by 2020. However, it will first decide on the future leadership of the airline and whether it will endorse the incumbent management for another term or bring in a new executive team.
Croatia Airlines’ privatization process was started three years ago, however, no parties showed interest in purchasing a stake in the airline at that time. In 2016, Croatia Airlines converted their order for 4 Airbus A319-100’s into an order for 4 A320NEO aircraft, citing unprofitable operation costs on existing A319 aircraft. The A320NEO’s are due to be delivered in 2021 and 2022. In 2017, Croatia Airlines leased two Bombardier CRJ-1000 aircraft from Air Nostrum, which are due to leave the fleet on the 30th of September, following the end of the summer season.
Featured photo from ExYuAviation.