PRIVATISATION: No decision yet on Cyprus Airways

Communications and Works Minister Marios Demetriades has dismissed allegations that the government had decided beforehand to sell Cyprus Airways (CAIR) to Aegean Airlines.

Commenting on statements made by CEO Michael O’Leary that the Greek rival “was more likely to succeed in its bid to use the airline to feed traffic to Athens”, Demetriades said the procedure was going ahead with evaluations by the technical committee, and that there was no decision yet.

Nine airline companies and investment funds have submitted non-binding business plans to take over the government’s 94% stake in ailing CAIR, burdened with high costs, a shrinking network and dropping passenger numbers.

Of the 15 that initially expressed interest, Greece’s Aegean Airlines that recently merged with Olympic, low-cost giant Ryanair that wants to establish a regional hub and Israel’s Arkia Airlines that operates five flights a week to Larnaca are seen as frontrunners.

Other bidders reportedly included Air Aruba, the Canadian venture firm Triple Five, as well as fund managers, while Russia’s S7 and Romania’s budget airline BlueAir dropped out.

“We hope to enter the final stage soon, during which more binding offers will be made,” Demetriades said, adding that the ministerial committee convened on Wednesday and was briefed on how the procedure was progressing.

Demetriades said he hoped there would be a result soon, noting that it was not an easy procedure.