Despite failure of vote for Krasair split, sources believe division may occur

Published: 10/8/1999

In the EGM on October 6th, Krasair shareholders voted against the proposed separation of Krasnoyarsk airline from Krasnoyarsk airport (www.concise.org 23rd September 1999). The reasons for the successful vote against the very specific intensions of the regional government led by Alexander Lebed, appear to rest on a contest of ownership between the regional government and Moscow, which resulted in 51% of the shares not being voted. According to reports, despite ceding the rights to the share to the regional property fund three years ago, the federal government has decided that it has right to the shares, so has been contesting ownership. The net result to date has been to leave the shares unvoted at the EGM and the regional government's plans unfulfilled. Local opinion however, suggests the close relationship between the management of the airline and the regional government will yet see the split forced through. In the short term the EGM agreed to approve a separate accounting of the airline and the airport to establish the profitability of each business and elected a new Chairman, S. Petrushko. Prime-Tass has also reported the company's financial results for the first nine months of 1999, as follows: 9mo 989mo 99% change Revenues, Rb m666126690% Revenues, $ m93.752.6-44% Passengers carried, 000487623.828% Cargo,000 tonnes10.414.237% RPK, mn pass/km1626239047% New opened routes2145114% Despite the 42% increase in fuel prices- in roubles - over the last two months, Krasair increased its prices by only 20% through more efficient use of its aircraft. Its commercial load factor increased by 10% to more than 60% for 9mo 99 compared to the previous year.

Article ID: 962