The Government has decided to completely revamp the ailing national carrier SriLankan Airlines under a public-private partnership (PPP) unit set up at the Ministry of Finance, after several failed investing attempts, Secretary to the Ministry of Finance, R.H.S. Samaratunga said on Friday.
Addressing a post Budget press conference at the Parliament premises, he said the PPP unit will soon appoint consultants for the re-structuring process.
“Managing a debt-ridden Airline is a difficult task. Therefore, we have decided to introduce a completely out-of- budget management solution to overcome it”, he said.
There were more than 100 senior officers currently receiving more than Rs 1 million as salary.
Meanwhile, speaking on the occasion, Finance Minister, Mangala Samaraweera said there were no possible investors for SriLankan Airlines at the moment.
US- based private equity firm TPG Capital, the solitary shortlisted party which was to buy a 49 % stake in SriLankan Airlines, has pulled out of talks about the potential acquisition mid this year.
SriLankan Airlines is struggling with colossal debt and decided to sell four new Airbus A350s after cancelling an order for four of the aircraft. It has also stopped some loss-making destinations to Europe.
SriLankan’s operational losses widened to Rs 28.14 billion in 2016 from Rs12.62 Billion in 2015. Operational losses for the first four months of 2017 were Rs 9.52 Billion. By the end of April, the Airline’s accumulated losses were Rs 170 Billion and the Company’s net worth was a negative Rs 116 Billion. Bank borrowings amounted to Rs 91.59 Billion, with Treasury guarantees amounting to Rs 29.92 Billion and US$ 210 Million.