Gulf Air Sinking?
You gotta’ luv how the Government and Mumtalkat are playing with Gulf Air! First Mumtalakat took it, only to realize that it’s a sinking company with little or no chance of recovery (which is, quite questionable if I may say) it throws it back to the government assuring the general public that privatization is not in agenda until the “company turns profitable”. I quote:
أكد الرئيس التنفيذي لشركة «ممتلكات»، طلال الزين، وجود خطة لنقل ملكية «طيران الخليج» من شركة «ممتلكات» إلى الحكومة. وقال «إن القرار ينتظر موافقة مجلس التنمية الاقتصادي». وأرجع الزين القرار خلال حديث مع «العربية» إلى عدم تلمس فرص استثمارية. وقال «إن طيران الخليج خسرت 500 مليون دولار خلال 2009» متوقعا أن تتحول إلى الربحية في أقل من 5 سنوات. وأضاف «أن التحول إلى الخصخصة لن يتم قبل التحول إلى الربحية». لافتا إلى أن هناك مستثمرين جاهزين لشراء حصص في الشركة، لكنه استبعد خيار بيع حصة من الشركة في الوقت الراهن.
But today, The GDN reports otherwise! Forget 5 years! We are now talking One!
Bahrain plans to privatise the country’s loss-making carrier Gulf Air within about a year, after its turnaround programme bears fruit, said Economic Development Board chief executive Shaikh Mohammed bin Essa Al Khalifa.
“The intention is to privatise but if you’re going to privatise something, people want something that doesn’t have a hundred-tonne anchor weighing it down,” Shaikh Mohammed said.
“It will take realistically a year.” GDN
Profitable in a YEAR?! Who are they fooling here?! You are talking about a company that had accumulated more than 1 billion dollars in losses in less than 5 years and you’ll turn it profitable in a year? Without pumping more money into it?! And where exactly did they find investors that are willing to pump money into such a company today? In such market conditions and for a company that is only doomed to fall?! Give me one reason why would anyone put money on Gulf Air?
What a joker! Removing fuel or electricity subsidies is in the too hard basket so we will kick down the road for a few more years… but privatising an airline that is estimated to lose $500 million in 2009…yep, we should do that by the end of the year
It should be privatized. A simple solution to make money is to operate more routes. They should add secondary cities of Saudi like Tabuk, Yanbu, Jizan and cities in Iran. Become a regional hub.