Sri Lankan government to divest majority shares of Sri Lankan Airlines
The majority of shares of Sri Lanka’s national carrier, Sri Lankan Airlines (SLA) are owned by the Government of Sri Lanka (GoSL). GoSL is now offering 99.56% of SLA to investors.
SLA operated jointly with Emirates Airlines from 1998 to 2008 making a profit of $ 68.7 Million during the said term.
The SLA made significant operational profits during its partnership with Emirates which reflects the financial potential of the airline. SLA flies direct to 26 top destinations where it holds landing rights and is renowned globally for its excellent in-flight service and quality of cuisine.
SLA presently serves 37 destinations and is the only operator to have direct flights to Australia, France, Germany, Japan, South Korea and the UK from Sri Lanka. It operates direct flights to 26 countries for which the airline holds landing rights. All the aircraft of SLA are leased. Sri Lanka Catering Limited (Catering) is a subsidiary of SLA supplying food and beverages to flights; SLA is authorized by Airport and Aviation Services Sri Lanka Pvt Ltd (AASL) for ‘ground handling’ and has earned profits for the past 10 years from ground handling operations.
Although SLA has made profits through catering and ground handling, SLA has incurred severe losses and has defaulted to pay its creditors with local and foreign loans (Total Assets at 613 million and Total Liabilities worth $ 2,212 million, as at 31st March 2023); and for the services rendered to SLA by State Banks and Ceylon Petroleum Corporation (CPC). The International Monetary Fund (IMF) has highlighted the importance of restructuring SLA as part of the country’s economic revival.
However, SLA made an operating profit of $ 33.8 Million after the exchange loss for the year ending 31st March 2023 for the year.
OSL take:
Sri Lanka’s geographical positioning in the Indian Ocean and the steady growth in foreign travelers visiting the country have increased the business/investment opportunities in the country’s aviation industry.
With the country being further focused on becoming an emerging business destination in the South Asian region, the opportunities in the aviation industry are likely to see a further expansion.
Also, the performance and profits recorded by Sri Lankan Airlines during its partnership with Emirates Airlines indicate the growth and business potential in Sri Lanka’s national carrier. Foreign businesses/investors could therefore confidently explore the growing opportunities in Sri Lanka’s aviation industry, especially in Sri Lankan Airlines.
Opportunity Sri Lanka (OSL) and its affiliated organizations have a significant track record of assisting both foreign and local entities in securing a wide range of contracts within Sri Lanka. Notably, some of OSL’s partners include globally renowned Fortune 500 companies. At any given time, their project pipeline, encompassing investments and tenders, exceeds a substantial one billion US dollars, making them a prominent player in the market. OSL boasts the most extensive inventory of business opportunities in Sri Lanka, setting them apart as the market leader in this regard. To facilitate business interactions in Sri Lanka, OSL has established opportunitysrilanka.com, a dedicated digital platform that serves as the exclusive hub for opportunity-related content, independent of advertisements or sponsorships. As part of their core business operations, OSL Global is actively seeking suitable investors and introducers to assist potential investors in utilizing OSL’s services to successfully navigate the bidding process. Importantly, OSL provides its comprehensive services without any upfront fees. Additionally, OSL is capable of introducing international firms with a local presence to carry out specific functions, such as buy-side due diligence, at their standard charge-out rates. To benefit clients of OSL, these services may be offered at a special discounted rate.
| Article Code : | VBS/AT/20231110/Z_1 |