Sri Lanka Aviation

Treasury to absorb SriLankan Airlines liabilities

The government decided to create a Special Purpose Vehicle (SPV) under Treasury to absorb the total liabilities of SriLankan Airlines after writing them off its balance sheets, a Minister said yesterday.

Public Enterprises Development Minister Lakshman Kiriella told Daily Mirror it was a pre-requisite to strike an equity sharing arrangement with an investor to develop the national career. He said the national career should start with a clean balance sheet with no debt burden.

“We had talks with the Finance Ministry a couple of weeks ago and decided to create the Special Purpose Vehicle. It is an entity to transfer the liabilities of the national career,” he said.

The Minister said a lot of investors including foreign airlines had shown interest in investing in Sri Lanka’s national career, but outstanding debt volume, accumulated over a period, had been deterrence.

He said the airlines from the countries such as Japan, China and Germany were keen to partner with Sri Lankan Airlines under an equity sharing arrangement.

“We are contacted by a lot of investors. There are several airlines from China alone. But, the liabilities are a problem,” he said.

Earlier, the Cabinet had granted approval for the government to absorb the total liabilities of the national career amounting to Rs.461 billion. (Kelum Bandara)

Daily Mirror

Most probably a Chinese airline if something does come about, no one else would dare to get involved with so much interference. Maybe it's a blessing in disguise for UL as well as local Gov interference will be much less with Chinese involvement.

Rs 461 Billion represents almost U$2.8 Billion.

There is no breakdown on what exactly has been transferred. Not a good day for the citizens of the country - more debt for them!

A good day for the Rogues responsible for this mess - they are closer to escaping any punishment.

It changes nothing imho.

The Airline still won't make money so there will be zero return on investment (ROI) so why would anyone buy this?

This PPP is a fantasy story - 49% ownership is a non starter for reasons explained previously.

Just more delusional thinking imho.

Thats in more than 25% Sri Lanka's Foreign Exchange Reserves...I will believe it when the liabilities are absorbed...absolutely no way.

SriLankan Airlines to suspend flights to Hong Kong from October

SriLankan Airlines has decided to suspend flights to Hong Kong from October, the airline said today.

The National airline said that after having re-evaluated its presence in the Far East, the Airline is suspending operations to Hong Kong with effect from October 27, 2018. This decision has been taken following careful assessment of commercial results over a significant period of time.

The airline said it will continue to evaluate future opportunities in the Hong Kong region, as it does with all its markets.

Arrangements are being made to route passengers who have already purchased tickets to and from Hong Kong, on other airlines.

More:

Very Sad news why Srilankan doing this

I'm confused How economical cancelling the Hong Kong route?

I can't understand why close such a route that is almost or mostly full of pax daily. The airline will face more losses than making profit.

As per HK station Manager, He said HKG CMB route should have cargo + pax, recent days downgrade of aircraft made them to loose the cargo business which CX started to use this opputunity to bring there 747 thrice week,
also high demand season CX using 77w with 400 pax,
how come UL still cant be successful with A321Neo.

Oh bother. Devastating to hear.

As I said before, It Seems like UL would only be operating only to India and Maldives in a couple of years from now

Agreed! However, It'd be a blessing if any Foreign Carrier would Invest in UL at this point (even with a lesser debt burden)

They'd have to completely restructure the Airline, its Management, Operations and Fleet and get those idiots at the Civil Aviation Authority to understand that their legislation on having a carrier operating a maximum of 3 types of Aircraft is absolute bullshit and for it to be scrapped immediately

Take GAN for example, does it seem feasible to operate at 25 to 30% on a thrice weekly basis and that too utilizing an A320!
Get a couple of Turboprops or A319/A220's for Gods sake and utilize them on routes with lower yield

Look at the schedule to VNS - twice weekly on the same day that Air India flies as well!
So much for competition

full of pax doesn't means it's profitable..

yeah correct as I heard there is no profit yeild .plus bc load is poor .(of course when CX operates with their brand-new flat bed 7 times a week )

are you kidding?? Have you seen the load of that flight?? This not the profit thing man. You should understand that. They suspended our european flights as well. Whats the meaning?? Still they are non profitable airline. What the faq man