SAS eyeing stake in Estonian Air

  • 2003-06-21
  • Baltic News Service

Several aviation sources claim that talks between SAS, the Scandinavian carrier, with Maersk Air over the acquisition of the latter's stake in Estonian Air have reached the final stretch and the agreement could be concluded before the end of June.
Chairman of the Supervisory Council of Estonian Air Olev Schults told the business daily Aripaev that he coulodnot comment on matters related to Maersk Air, but "the likelihood of changes in Estonian Air's ownership is bigger than that of no changes taking place in the near future."
Schults said it was possible that if the circle of owners of Estonian Air changed the investment company Cresco he manages would sell its 17 percent holding.
Speaking for SAS, Ulf Thorne said the Scandinavian carrier was interested in increasing its presence in Estonia.
But this can be done in two ways, explained Thorne: by either developing a business of its own or acquiring a stake in a local aviation company.
At the moment no agreements with Maersk Air have been concluded, he said.
Spokesman for Maersk Air Per Brinch said he had learned through the press about several companies eager to acquire Maersk's holding in the Estonian carrier but denied that concrete talks were in progress.
In April it was reported that Finnair was interested in acquiring Maersk's 49 percent stake in Estonian Air, which was first reported up for sale in early April.
Maersk by law is not allowed to sell its stake without the government's permission.
Estonian Air ended last year with 39.2 million kroons (2.5 million euros) in profit on sales of 838 million kroons, the biggest in the firm's history.
The company made a profit also in 2001 after years of loss-making.
Also, passenger traffic is on the rise. Over the first four months of the year, almost 100,000 passenger flew Estonian Air's regular flights, 21 percent more than the previous year.
The average load rate on the airline's flights was 54 percent, according to Erki Urva, company president, who said last month that the war in Iraq and the SARS scare had had no effect on passenger demand.
Other than Maersk, the owners of Estonian Air include the government, with 34 percent, and Balti Cresco Investeerimisgrupp (Baltic Cresco Investment Group) with 17 percent.