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Serbia expects 400 mln euros from sale of its biggest airport

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Dec 5 Serbia expects to raise 400 million euros ($428 million) in the privatisation of its biggest airport, Belgrade’s Nikola Tesla, Prime Minister Aleksandar Vucic said on Monday.

Once closed to international air traffic during a decade of war and sanctions under late Serbian strongman Slobodan Milosevic, Belgrade’s passenger numbers rose sharply after Abu Dhabi’s state-owned airline Etihad bought a 49 percent stake in national airline JAT in 2013, renaming it Air Serbia.

“We could even get 600 million euros if we give it in concession for a longer period,” Vucic told reporters after meeting the European Union’s enlargement commissioner Johannes Hahn.

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Serbia is under pressure to move ahead with privatisations from the European Union and the International Monetary Fund under the terms of a 1.2 billion-euro IMF loan.

Airports in Europe are often seen as attractive infrastructure investments thanks to expected passenger growth and dense populations and several privatisations are on the cards.

Bulgaria expects to bring about 1.2 billion levs ($656 million) into state coffers by selling a 35 year concession to operate its state-owned Sofia airport, which has slightly fewer passengers than Belgrade but is growing faster.

Passenger traffic at Nikola Tesla airport grew 3.8 percent to 4.6 million last year, while Sofia passenger numbers grew 9 percent to 3.8 million.

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Shares in Aerodrom Nikola Tesla – of which the state holds 83.15 percent – are down 4 percent this year, trading at 1,100 dinars on Monday and giving the company a market value of 38 billion Serbian dinars ($331 million).

In the first nine months of this year, Nikola Tesla airport reported a net profit of 2.4 billion dinars, a 13 percent increase compared with last year.

The government will have to compete for investment with other airports in the region.

Among those planning to bid for Sofia airport are Turkey’s Limak Holding, Russia’s VTB Capital and Switzerland’s Flughafen Zuerich, a source familiar with the process told Reuters last month before the process was delayed for a second time.

Germany’s Fraport is also buying 14 regional airports in Greece.

And France is also among European countries raising cash from airport privatisations to help meet budget deficit targets, selling 60 percent stakes in Nice Cote d’Azur and Lyon-Saint-Expury, for almost 1.8 billion euros.

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