RIGA - A top government official hinted last week that the state's controlling stake in airBaltic could go up for sale in 2005.
In an interview with the Diena daily, Transport Minister Ainars Slesers said the state was ready to sell its shares in airBaltic since, in his words, the state has no holdings in companies that are not natural monopolies.
It was unclear whether Slesers was sharing his ministry's ideas or speaking on behalf of the entire government, which was formed only two weeks ago. It has been reported, however, that the government has listed airBaltic, which is 52.8 percent owned by the state and 47.2 percent by SAS, among companies that could be privatized next year for cash.
Officials from the country's two largest ruling parties - New Era and the People's Party - told Diena that no preparations were underway for the sale of the airliner.
Slesers, who a member of Latvia's First Party and was transport minister in the previous government, admitted that the sale was debatable. He also said that under the airBaltic foundation agreement the airline's strategy is determined by SAS even though the state maintains a majority stake.
SAS has repeatedly expressed a willingness to buy the state-held stake, making the prospect of a sale to a second strategic investor unlikely. Indeed, Slesers admitted that no international bids should be accepted for the airBaltic stake. Rather, the asset should first be offered to SAS and the Scandinavian airline's proposal analyzed by the government.
The minister declined to say what the airBaltic stake was worth, though he admitted it couldn't be much since the state was effectively not selling control over the company.
Still, Slesers said it would be better to sell the stake and in the meantime see to it that "people can fly in many directions" from Riga International Airport."
Slesers is credited for bringing discount airlines Ryanair and easyJet to Riga this autumn.
AirBaltic was funded in 1995. Last year it posted a profit of 1.1 million lats (1.4 million euros) on operational revenues were 33.5 million lats.
