State increases ownership stake in Air Serbia

The Serbian government has purchased 1.82 million newly issued shares by Air Serbia valued at a total of 15.5 million euros, increasing its ownership stake in the flag carrier by 1.6 points to 83.58%. In turn, Etihad Airways’ share in the company has declined to 16.42%. The right of pre-emptive registration of stocks was excluded in this case as it was determined that Etihad is currently unable to participate in the capital increase in the current circumstances. Air Serbia has said the latest recapitalisation, which took place upon its own request, will further assist the airline in overcoming the effects of the coronavirus pandemic and “strengthen its position as a regional leader which will continue to provide a direct and indirect contribution to the Serbian economy”.

The Serbian Commission for State Aid Control approved the capital increase, noting the measure is in line with the country’s legislation. In late 2020, the Serbian government recapitalised the airline to the amount of 100 million euros and took an additional 31% stake in the company. “We are grateful to the Government of the Republic of Serbia for providing support to the national airline to overcome business obstacles caused by the coronavirus pandemic”, the carrier noted. Air Serbia has previously said it plans to end this year break even or with a small profit. It reported a loss of 77 million euros during the pandemic-stricken 2020, which was decreased to a loss of 21.3 million euros last year.

Commenting on the airline’s ownership structure, Air Serbia’s CEO, Jiri Marek, recently said, “Air Serbia has played an important role during the pandemic, supporting the Serbian government with repatriation flights, as well as the uplift of medical equipment and so on. I think we've proven that our operations do not only contribute to connectivity, but also bring significant economic benefits. We believe the government wants a strong national carrier that continues to grow. There are various models in the industry with different participation structures and different levels of state participation. Even combinations of private and state shareholding is possible. It is up to the Serbian government to find the most suitable model”.

EX-YU Aviation News

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