Adria to seek strategic partner after Sukhoi fallout
Adria Airways is seeking a strategic partner following a failed agreement to acquire fifteen Sukhoi Superjet 100 aircraft. The airline's shareholders have cancelled a planned ten million euro capital injection into the company. The carrier's CEO, Holger Kowarsch, said the deal with the Sukhoi Civil Aircraft Company (SCAC) would also have involved a ten million euro investment on behalf of the Russian manufacturer which would have been turned into equity. Mr Kowarsch explains that after preliminary contracts were signed, SCAC did not deliver the payment which was due in late February, which is why Adria quit the deal. He rebuffed claims that it was SCAC who walked away from the agreement due to the Slovenian carrier's finances, noting that the Russians carried out comprehensive due diligence, which involved between twenty and thirty experts from consulting and auditing companies. Mr Kowarsch noted that SCAC had access to all information concerning Adria's business, prior to signing a Letter of Internet with the airline, including the carrier's net loss for 2018 which will be in the double digits.
According to Slovenia's national carrier, the amount of shares SCAC would have received for its ten million euro investment into Adria was yet to be determined. "We need a partner whom we can rely on and can find a common language on the future development of Adria Airways", Mr Kowarsch said. He added that the company was at first disappointed with its failure to reach a deal with SCAC, since its crew had already been undergoing training for the Superjets in Venice. However, following talks with its partners in Europe and the United States, the CEO noted he received information that "put the Russians in a bad light as business partners". Mr Kowarsch explained that Adria still needs a strategic partner but there is "no rush". Talks are taking place with potential investors.
Adria's shareholders have cancelled a planned ten million euro capital injection which was to be carried out during the first quarter of 2019. "Given that Adria doesn’t need to finance the transition to a new aircraft type anymore, and based on its positive business plan, no additional capital increase is planned", the company said. Mr Kowarsch added that following the initial capital injection in late 2018, which was paid for in cash, Adria has been financially stable. "While there were still some liquidity problems last winter, the prospects for the summer season are good. The plan for this year is to get out of the red. Last year's loss is a result of several factors, among them damages Adria had to pay for cancelled flights and delays, increased fuel prices, lack of staff and the delay in introducing Saab 2000 aircraft", the CEO said.
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