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Air Serbia needs a strategic partner due to additional capital

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Air Serbia needs a strategic partner in order to provide additional capital for possible risks coming from the international environment and for further expansion of the network, said Petar Vojinović, editor of the aviation portal Tango six, today.

He told Beta, regarding the statement of the President of Serbia, Aleksandar Vučić, that the domestic airline Air Serbia needs a strategic partner, that the goal is to secure additional capital for emergency situations, through a strategic partnership that cannot exceed 49 percent co-ownership, due to European Commission (EC) rules.

Two days ago in Qatar, Vučić asked the emir, Sheikh Tamim bin Hamad al-Tania, “to see if they can help and if they have an interest in becoming a strategic partner” of Air Serbia, which is “achieving good results, but will it be like that?” and in the future it does not depend only on Serbia, but on the market, because now we can see that the big world companies are falling”.

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He said that Air Serbia is completely in Serbian hands and announced that talks will continue after an assessment by experts.

Vojinović said that Air Serbia’s need for a partner is not due to acquiring new skills or help in business management, which was a priority when the partnership with the Etihad company from the United Arab Emirates was achieved, but most likely due to the provision of additional capital.

“Neither Qatar nor any other airlines can offer Air Serbia anything fundamentally new in terms of technology, knowledge and management at this stage. 

The search for a strategic partner is a backup option as a safety measure due to the unpredictable and difficult airline business, which is affected by things beyond their control. to control such as, for example, the pandemic,” said Vojinović.

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As he said, the State of Serbia, with the approval of the EC, gave Air Serbia several tens of millions of euros during the pandemic, but the company must return that money.

According to Vojinović, subsidies to Air Serbia were granted in a controlled manner, from the very beginning and with the approval of the EC due to Air Serbia’s operations in the deregulated, but monitored Open Skies Agreement, even though Serbia is not a member of the EU.

He added that the state took over 200-300 million euros of Jat Airways’ debts, but that this was compensated by the concession of the Belgrade airport “Nikola Tesla”, which was obtained due to the growth and investment of Air Serbia, which increased the number of passengers by 1.9 million.

“Air transport is a closed system that generates value, but it must be subsidized under control and those investments returned to the budget. 

Air Serbia has embarked on an expansive expansion and this year in the summer period it will have 80 destinations, which is ten more than Jat had in its most glorious days,” Vojinović said.

He added that this year, as it announced, Air Serbia will have a profit of 20 million euros due to the expansion of its network and increased routes to Russia.

Consultant for foreign investments, Milan Kovačević, told “Nova” that it is a little unusual that Vučić invited Qatar to a strategic partnership in Air Serbia, because “the Emirates and Qatar are not on good terms, so perhaps it is also about Etihad’s ownership of Air Serbia will be completely transferred to Qatar”.

According to data from the Central Register of Securities, Air Srbija Joint Stock Company is 83.85 percent Serbian owned, while the remaining 16.42 percent is held by Etihad.

Ever since 2013, when Jat was shut down and an arrangement with Etihad was made, the state has financially intervened in this company several times, and within the first five years, it allocated more than 200 million euros for it.

At the beginning of the co-ownership, Etihad owned 49 percent of Air Serbia, while the rest belonged to Serbia, but over time the ownership structure changed.

At the end of 2020, capitalization was done for the first time, when the ownership share of the state was increased from 51 to 81.97 percent, in which 100 million euros were invested.

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