The Estonian state has been planning to merge the two companies for a number of years. Now, according the Ministry of Economic Affairs, preparations are finally underway to make that happen, with plans in place to bring the proposal to that end to the government later this year.

Preparations for the merger of have been ongoing in connection with state aid granted to Nordica during the height of the coronavirus pandemic in 2020. In the fall of that year, the Estonian government paid €22 million of Nordica Aviation Group AS' share capital, with the company granted a further €8 million in state aid.

The aid was awarded on the proviso that the government had to either relinquish its stake in the company or demand the return of the funds within seven years.

According to Estonian Minister of Climate Kristen Michal (Reform), Nordica plans to exit the state aid scheme and is expected to do so by the fall. "After that, preparations can continue to merge the companies into a single group," Michal said.

"I will then make a proposal in the government to privatize Nordica. The final decision will be made by the government. Owning a company in a non-competitive market is not a core task for the state. It is in the interests of the people and economy of Estonia to have good, high-quality connections to the world." said Michal.

Transpordi Varahaldus (TVH) owns seven Bombardier CRJ900NG jet-powered 88-seat passenger jets, which are on long-term lease to Nordica.

Nordica has sub-leased six of those aircraft to its subsidiary Regional Jet, which operates under the Xfly brand.

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