New management company to takeover(260 words)

Published: 1/3/2001

The Irkutsk Regional Court of Arbitration has approved the settlement between Baikal Airlines (based in Irkutsk) and its creditors, signed on 13 December 2000. This settlement calls for debt restructuring to the tune of 295 million roubles (around $10 m) over 11 years. Part of the agreement requires the company to clear debts of 1.8 million roubles ($0.06 m) to the regional administration, by the end of the year. Subsequent to the payment rescheduling of the major creditors, the company will then determine the order and timetable for payment of fifth-tier creditors. All payments are to be made from net profits (forecast at 27 million roubles ($ 1 m) per annum). Baikal Airlines are repaying major creditors with the proceeds of the sale of an 80% shareholding in its cargo subsidiary, AO Baikalaerogruz, to the Moscow cargo carrier airline Tacis. The deal is worth 115 million roubles ($4.6m), 62m roubles of which is represented by a cash payment, with an undertaking from Tacis to invest 50m roubles in the fleet over the next three years. They have also agreed to use the Baikal technical facilities. Tacis has committed itself to hiring 104 employees, including pilots, from Baikal, with all wage arrears honoured. The airline has recovered one of the three Il-76s illegally sold to East Line by the previous General Director, Vladimir Kovalenko. The airline shareholders will meet, shortly, to vote on the management company for Baikal, which is to be headed by Nikolay Rusanovsky, Director of Expert-Baikal.

Article ID: 2267