Pieter C. 5 Report post Posted January 13, 2009 Swiss investor acquires troubled flyLAL Monday January 12, 2009 FlyLAL Lithuanian Airlines has been purchased by SCH Swiss Capital Holdings for $1 million plus an agreement to cover debt of some €1 million ($1.4 million). "We were looking for an airline to purchase, and this is a good company to invest in. . .FlyLAL can be a very strong regional carrier," SCH CEO Jan Erik Jansson told the Associated Press, adding that the firm does not "see these debts as a big problem." The sale will take effect on Jan. 23, according to reports. FlyLAL was privatized in 2005 and was held by several Lithuanian investors. It lost LTL8.1 million ($3.2 million) in 2007, according to Agence France Presse, and last month was rebuffed in its attempt to sell a 51% stake back to the government for a "symbolic" LTL1. At that point it announced the suspension of service to Istanbul Ataturk, Rome Fiumicino and Paris Charles de Gaulle and a reduction of flights to Frankfurt and Milan. On Dec. 19 FlyLAL said its debt amounted to LTL89 million, of which LTL47.5 million was owed to shareholders. Just before Christmas, CEO Vytautas Kaikaris was forced to issue an official denial of rumors that it was on the verge of suspending all operations. It operates four 737-500s and three Saab 2000s. Share this post Link to post Share on other sites
Pieter C. 5 Report post Posted January 21, 2009 Sale falls through, flyLAL ceases operations Wednesday January 21, 2009 FlyLAL Lithuanian Airlines ceased operations Saturday after its acquisition by SCH Swiss Capital Holdings fell through. The Swiss investment fund agreed to purchase the troubled carrier this month for $1 million plus an agreement to cover debt of an additional €1 million ($1.3 million), but flyLAL said that SCH "did not fulfill its obligations under the agreement" and that it "cannot secure the continuity of its operations and satisfy the demands of its creditors." SCH did not transfer the funds in time, flyLAL CEO Vytautas Kaikaris said, adding that shutting down was "the only possible course." The carrier's last flight left Amsterdam Friday and it said that more than 29,400 passengers were affected by the shutdown. It said its debt, which is not covered by assets, stands at approximately LTL90 million ($34.3 million) and that in addition to the current industry downturn its bottom line was affected by a fleet that "did not correspond to the new market conditions." Falling load factors meant that "flight operations only increased the airline's loss," it said. FlyLAL employed 360 and operated nine 737-300s/-500s, two 757-200s and three Saab 2000s. It left open the possibility for a relaunch, with Kaikaris saying that it is "open for further proposals" as long as they are received in the coming days. Otherwise, it will file for bankruptcy. It has filed a lawsuit against airBaltic and Riga International Airport for LTL200 million, claiming "unfair competition." FlyLAL said its financial circumstances would "change substantially" if the suit is successful. Share this post Link to post Share on other sites
Tamizi Hj Tamby 1 Report post Posted January 21, 2009 Thanks for the latest update,Uncle Pieter. Sorry for my ignorance;is flyLAL Lithuanian flag carrier? Share this post Link to post Share on other sites
Pieter C. 5 Report post Posted January 22, 2009 Sorry for my ignorance;is flyLAL Lithuanian flag carrier? Correct, so Lithuania now without flag-carrier, however, AirBaltic (Latvia) had opened a hub at Vilnius some time back 'pushing flyLAL out of the market'... Estonian from Estonia also seems to be in big trouble financially and will not survive without a cash-injection from SAS Share this post Link to post Share on other sites
Pieter C. 5 Report post Posted January 26, 2009 Indebted Lithuanian Airline Files For Bankruptcy January 23, 2009 Lithuanian carrier flyLAL, which was privatized in 2005 and counts Scandinavian airline SAS among its competitors, said on Friday it had filed for bankruptcy. The indebted airline grounded its flights last weekend after failing to attract an investor. "Being unable to continue flights and without seeing any real chances to renew operations, we were forced to file for bankruptcy," chief executive Vytautas Kaikaris said in a statement. He added that the firm's financial situation "worsened significantly at the end of 2008 and beginning of 2009 and there were no possibilities to improve it without additional investments". The company said its had 89 million litas (USD$33.41 million) of debt at the end of 2008. Vilnius Airport has started negotiations with a number of airlines to fill the gap left by the former national carrier. "There are negotiations going on with six airlines, and some of them could start flights from Vilnius for sure," said airport spokesman Arunas Marcinkevicius. A group of businessmen privatized Lithuanian Airlines for 25.6 million litas in 2005, restructuring it into a number of companies. FlyLAL's owners are to continue a charter firm. The government rejected a proposal to buy flyLAL back for a symbolic 1 litas and cover its debts. The plan to sell its shares to a Swiss-registered investment fund also failed. (Reuters) Share this post Link to post Share on other sites
