Travel Service becomes second biggest shareholder in Czech Airlines
The Czech Republic’s national carrier Czech Airlines is no longer a state-owned company. This week, its majority stake has moved into the hands of private companies. Travel Service company, a member of Unimex Group, announced on Tuesday that it has finalised a purchase of 34 percent of the Czech air carrier after action on the purchase option offered by Korean Air. It therefore becomes Czech Airline’s second largest shareholder.
The state-run Český Aeroholding currently owns a 20-percent stake in the Czech Airlines, while the South Korean carrier Korean Air has 44 percent.
The process of privatising Czech Airlines, a company with more than 90-year-old-tradition, got underway in 2013 under then prime minister Petr Nečas, when the government decided to sell 44 percent of stakes to Korean Air for 67.5 million crowns, with an option offered to sell another 34 percent.
Spokeswoman for Travel Service Vlaďka Dufková said that according to information that has not yet been confirmed, the owner’s equity at Czech Airlines has fallen by about 500 million crowns since the agreement with Korean Airlines was signed.
According to Dufková, the company currently has a negative value totalling h hundreds of millions of crowns and accumulated losses of around 5.5 billion crowns.
Český Aeroholding spokesman Jakub Puchalský said on Tuesday that the situation of Czech Airlines has stabilised significantly in recent months due to ongoing restructuring.
Czech Airlines lost around one billion crowns in 2013. Last year, the company announced massive lay-offs and eventually released around half of its total employees. It has also lowered the wages of those who remained by 40 percent on average. Czech Airlines has also lost about one fifth of passengers on its scheduled routes last year, mainly due its focus on Russia and the former Soviet Union destinations, which has been negatively affected by the situation in Ukraine.
Czech Airliners is the world’s fifth oldest airlines still in operation, following Australia’s Quantas, Dutch KLM, Russia’s Aeroflot and Columbia’s Avianca.
Travel Service, the largest Czech air company, was established in 1997, and has been operating in the Czech Republic, Slovakia, Hungary and Poland. The company runs charter and regular flights under the brand name SmartWings and Business Jet private flights.
It operates 40 aircraft including Boeing 737s, Airbus A320s and smaller Cessna Citation planes. In 2013, Travel Service posted a gross profit of 219 million crowns.