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Air Jamaica not sold yet, say Gov't officials
Sunday, July 05, 2009
Government officials were, up to last night, tight-lipped about the reported sale of Air Jamaica to discount carrier Spirit Airlines, offering only that a deal has not yet been signed.
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| WEHBY. has not yet discussed the Air Jamaica privatisation report with the prime minister |
"We are still talking to interested parties and the matter has not yet gone to Cabinet," said one Air Jamaica board member who requested anonymity.
He was reacting to yesterday's lead story in The Gleaner which stated that the national carrier had been sold to Indigo Partners and Oaktree Capital, said to be the owners of Spirit Airlines.
One Government official close to the Air Jamaica privatisation process reiterated that the Privatisation Committee, chaired by Dennis Lalor, had submitted to Don Wehby, minister without portfolio in the Ministry of Finance, the evaluation and recommendation report on the privatisation of the national carrier.
Last night, the official said that Wehby had not yet discussed the report with the prime minister and will not be able to do so this week, as he (Wehby) will be off the island holding meetings with the International Monetary Fund.
"There has been no sale as yet," the official said. "The recommendation still has to go to the Cabinet and the board of Air Jamaica before a decision is taken."
Yesterday, The Associated Press reported that Spirit spokeswoman Misty Pinson refused to comment when contacted.
According to The AP, Spirit is privately owned and flies to 36 cities in the US, Latin America and the Caribbean.
Year to date, Air Jamaica reported an operating loss of US$63.51 million on revenues of US$293.27 million, considerably better than last year's performance which saw the airline reporting an operating loss of US$162.43 million on revenues of US$350.98 million.
Last week, Wehby said that the improvement in the financial and operational results of the airline has helped the process and has increased investor interest in the airline.
He said that the privatisation committee - assisted by expert input from the International Finance Corporation, which is the private sector arm of the World Bank Group, and which has a record of over 150 successful assignments in 60 countries - had negotiated strategically with the two top investor prospects and has made a final recommendation for the signing of a document of agreed terms with one party. The terms include a provision for the Government of Jamaica to maintain a minority equity stake in the airline.
Last month, the Observer reported that Trinidadian carrier Caribbean Airlines and British tour operator Thomas Cook had both placed serious bids to acquire Air Jamaica.
The deadline for privatising Air Jamaica was recently extended to June 30.
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