Krsanoyarsk to gain control of state holding in Krasair in lieu of proceeds from Norilsk privatisation

Published: 11/4/1999

It seems that the recent disagreement between the federal and the Krasnoyarsk regional administration over the ownership of Krasair, Russia's fifth largest airline, may be in the process of being resolved. The failure to vote the disputed 51% of shares held by the state led to the plan to split airport from airline being voted out at the recent EGM. The regional government had strongly supported the proposed separation, in an effort to improve the efficiency of the regional air company. The Federal Ministry of State Property has agreed to the final transfer of the share to the local administration, which was originally supposed to have been transferred to the regional government by Presidential decree. The condition of the transfer appears to be that the government is compensated for the loss of its stake at market value against the federal debts to the regional government's budget, currently standing at 152m rubles ($5.8m). For Svtyatoslav Petrushkov, Deputy Governor of Krasnoyarsk and recently elected Chairman of Krasair, this appears to be a reasonably equitable solution, given the unlikelihood of getting cash from Moscow, which was owed for the privatisation of Norilsk Nickel. The region's legislative assembly has already thrown its weight behind the airline, with the recent announcement of $1.3m financing for the completion of a new Tu-204-100 for the airline at Aviastar. Krasair has expressed interest in two of the new Tu-204-100s and, according to reports, will discuss the financing and delivery of the second in December. Unconfirmed reports suggest that the aircraft are being supplied at a cost of $28-29m per unit.

Article ID: 1048