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Aeroflot to Take Control of Transaero

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Aeroflot to Take Control of Transaero

Aeroflot to Take Control of Transaero
September 01
11:51 2015

MIAMI— Transaero has confirmed in a press release, the plans of Aeroflot to integrate the troubled Russian airline as part of state-owned carrier group.

“An Interdepartamental Comission presided by First Deputy Prime Minister Igor Shuvalov held a meeting on the issues of the air transport industry. In the interests of a further develpment of civil aviation, and creating one of the world’s largest air groups, the Commission supported the consolidation of Transaero as part of the Aeroflot Group.”

Yesterday, business daily Vedomosti reported that Aeroflot’s board of directors will discuss a purchase of 75% plus one share in Transaero at the next meeting to be held tomorrow, sources also informed Vedemosti that the value of the transaction would be 1 rouble ($0.015 dollar).

Transaero_Airlines_A321_3

Aeroflot already owns a major stake in Aurora (resulting from the merge of SAT Airlines and Vladivostok Avia) and fully owns Donavia, Orenair, Pobeda and Rossiya Airlines.

According to the press release, Prime Minister Shuvalov praised the role of the founders, managers and employees of Transaero, and requested Aeroflot to fulfill all obligations to passengers and employees under the supervision of the Ministry of Labor and Welfare. As reported by RBC news, the transaction shall observe Russian anti trust laws in force.

“Transaero shareholders expect that this measure will promote the interest of its employees, partners and passengers.” The airline further stated that its normal operations will not be disrupted.

The collapse of more than 50% of the ruble’s value last year caused by the falling oil prices and the Western sanctions imposed on Moscow over its role in Ukraine led to a sharp decrease in air travel demand. In September 2014, Transaero requested a bailout to cover its debts with financial institutions, estimated in 67 billion roubles ($1 billion).

The impact of the crisis on the Russian carriers have led these to adjust their capacity. In the case of Transaero, the airline opted to cancel its Boeing 787 Dreamliner order and defer its 747-8I and Airbus A380 deliveries and take delivery of Airbus A321 and Boeing 737-800 in order, in an attempt to improve passenger yields and decrease operational costs. These deliveries came with the launch of a new corporate image, intended to be originally revealed in its deferred Very Large Aircraft.

Established in 1991 as the first privately-owned carrier after the demise of the Soviet Union, Transaero grew to become the second Russian carrier with service to 103 domestic and international destinations and a fleet around one hundred aircraft.

 

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