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Transport Minister’s communication on airBaltic has been complete “failure” – president

The communication of Transport Minister Kaspars Briskens (Progressives) on the issue of the Latvian national airline airBaltic has absolutely “failed”, Latvian President Edgars Rinkevics said at a press conference after a meeting with Prime Minister Evika Silina (New Unity) on Wednesday.

“Things that should have been explained on Friday afternoon were explained yesterday. The public has perfectly legitimate questions, it is taxpayers’ money that has been invested there,” Rinkevics said.

The president pointed out that it is the responsibility of the transport minister not only to discuss and present these decisions to the government, but also to explain them in a timely, understandable and reasoned manner to the public.

He also stressed that further decisions and projects to be submitted to the government would also be the responsibility of the transport minister.

At the same time, Rinkevics said that he would like the discussion on airBaltic to be less emotional and more pragmatic, taking into account the positive benefits of a national airline – connectivity to European cities, tourism and business development.

“But all this comes at a price, and I would like to see from the responsible ministry a clear vision of how we will develop further, timely answers to reasonable questions,” the president said, while reminding that the Transport Ministry is the state shareholder in airBaltic.

The president also revealed that he will meet the transport minister next week to discuss these issues.

The president said that there are things that need to be discussed and there are things that the government cannot reveal for the time being, while reminding that no irreversible decision has been taken on the issue of reducing the share capital of airBaltic.

The prime minister, for her part, revealed that she would assess Briskens’ performance also on the basis of how he manages to cope with the communication challenge. “Of course, one of the tasks of a politician is to explain decisions to the public in a way that they can understand, no matter how difficult the decisions may be, while also being honest about what the problems and challenges are,” said Silina.

Prime minister’s spokesman Aleksis Zoldners was asked to clarify whether the prime minister plans to assess the minister’s suitability for the post. He said that “the transport minister’s ability to explain the issues of airBaltic and Rail Baltica to the public is one of the factors to which the prime minister will pay particular attention when assessing Briskens’ job performance as minister”.

As reported, the government agreed at a meeting on August 30 that the state should retain at least 25 percent plus one share in the national airline airBaltic’s share capital after the initial public offering (IPO).

Transport Minister Kaspars Briskens (Progressives) told reporters that the state is currently considering sale of a minority stake in airBaltic before the IPO or going into the IPO, as well as possible participation in the IPO. “One condition that the government agreed on Friday is that the state should retain at least 25 percent plus one share after the IPO, which means having veto powers.

As it prepares for the IPO, airBaltic has decided to simplify its share structure. As a result, the nominal value of all Class A, B and C shares will be reduced to EUR 0.1 and EUR 571.293 million will be allocated to to offset accumulated losses from previous years. Shareholders will not be paid any remuneration or compensation in connection with the reduction in the nominal value of these shares.

Thus, the share capital of airBaltic after the reduction will be EUR 25.179 million, consisting of 251,795,252 dematerialized shares with a nominal value of EUR 0.1 per share. Each share will entitle the holder to one vote at the company’s shareholders’ meeting, a dividend and a liquidation allowance.

In 2023, airBaltic’s audited turnover was EUR 664.289 million, up 33.2 percent on 2022, and the company made a profit of EUR 33.852 million, compared to a loss the year before.

The Latvian state owns 97.97 percent of airBaltic’s shares, while the financial investor, Danish businessman Lars Thuesen’s Aircraft Leasing 1, owns 2.03 percent.

Source: BNS

(Reproduction of BNS information in mass media and other websites without written consent of BNS is prohibited.)

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