Middle Eastern carrier Oman Air is increasing its authorised share capital by RO200 million ($520 million), and spin off several businesses, after turning in higher losses of RO113 million last year.
The hike will bring its authorised capital to RO700 million. Muscat-based Oman Air says the overall share capital will equate to 700 million shares.
It adds that some of its businesses – which include aviation services, ground-handling and cargo – could be “managed better independently”, while remaining in the group.
“The aim is to transform these activities into separate legal entities, which will enhance their efficiency and effectiveness,” says chairman Darwish bin Ismail Al-Balushi.
Ground services and air freight will be the first to undergo separation. Each company, Al-Balushi says, will be able to “focus on its strategic objectives”.
Oman Air claims that, although its losses increased by 16% for the full year 2013, its overall contribution to the sultanate’s economy was around RO400 million.
This contribution “exceeds” the financial burden of the carrier’s losses, it states.
Oman Air’s passenger numbers were up some 13% to nearly 5 million, and revenues increased by 10% to RO381.7 million.
It says the expansion of its fleet with a further 20 aircraft – including its first Boeing 787s, due to arrive from 2015 – will enable the airline to start to “move towards profitability”.