Minister: Nordica sale has been obstructed by SAS contract
While negotiations are ongoing with a potential investor interested in purchasing state-owned airline Nordica, the recently terminated contract with Scandinavian operator SAS had been a key obstacle, Minister of Infrastructure Vladimir Svet (SDE) said Wednesday,
Speaking to the Riigikogu's Anti-Corruption Select Committee, the minister said while potential buyers had been identified earlier, they did not qualify, at that point, though one previously excluded buyer is still interested.
The main issue had been the SAS contract, he said.
This had put Nordica in a crisis situation, and had made it difficult to submit annual financial reports due to auditors' concerns, the minister went on.
He said: "This particular contract is the reason Nordica is currently in a crisis situation. It is the contract which prevents Nordica from submitting its annual financial report, as the auditors believed it to be problematic, and without an auditor's opinion, it is impossible to present a report."
Svet noted that the company has improved its performance more recently, with order fulfillment rates rising from 89 percent last summer to 98-99 percent this year.
Nordica has been in the black over the past four months, he added. "The current management board has made the right economic decisions."
"We all understand that precision is what matters in the aviation sector. It either leads to losses or a profits," Svet went on.
The ministry expects a business plan by October 15, to determine if Nordica can continue operations and move towards a touted privatization.
Late last month, SAS announced it was bringing its cooperation with Nordic Aviation Group subsidy Regional Jet.
Regional Jet had been operating under the Xfly brand, and had via wet-lease arrangements provided internal domestic flights in Sweden.
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Editor: Andrew Whyte, Barbara Oja