State looks to buy back Estonian Air

Dec 17, 2009
Oskars Magone

The scandinavian airline giant may sell off its shares in Estonian Air to the state (photo: SAS)

TALLINN - The Estonian state has announced an interest in buying back national air carrier Estonian Air, taking over the greater part of the shares from Scandinavian airline giant SAS.

Estonian Air is currently 34 percent owned by the Estonian state, 17 percent by investment bank Cresco and 49 percent by SAS. SAS gained control of the company in 2003.

This week the Cabinet is discussing the possibility of regaining control of the airline.

"We will discuss the situation, the structure," Economy Minister Juhan Parts said.

Estonian Prime Minister Andrus Ansip said the state would try to find a strategic investor if it decided to go ahead with the purchase.

"This market is very competitive and requires very specific competencies and tight cooperation with other airlines, therefore we think Estonian Air should also have a strategic investor in the future,” he said.

"The prime minister said that the state would only consider the purchase if SAS was able to quote a fair price for the deal.

"SAS plans to sell its holding in Estonian Air and has made a corresponding offer to the Estonian state. We are ready to consider this offer, but price will determine a lot,"he said.

The airline last year ran a deficit of nearly 176 million kroons.

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