Chris Jasper/LONDON Herman De Wulf/BRUSSELS

With SAirGroup on the edge of financial collapse following reports that it suffered a $1.5 billion loss last year, the Swissair parent has dropped chairman and chief executive Erich Honegger. Dr Mario Corti of Nestlé has been appointed to steer it through what the Swiss press have labelled "the biggest financial disaster" in the country's history.

An initial boardroom shake-up was due to see Corti succeed Honegger next year, but the move was overtaken by the impact of the reported losses, with SAir shares immediately plunging 14%. SAir responded by announcing that Corti, now Nestlé's chief financial officer and already on the airline's board, would succeed Honegger immediately. Five other directors will go next month, plus three next year, leaving only Corti from the current board.

Before the announcement of his early exit, Honegger had sought to dispel rumours of his group's parlous financial state, saying: "The situation is not bad but there are problems with SAir partners in Belgium, France and Germany" - a reference, respectively, to Sabena, AOM/Air Liberté/Air Littoral and charter carrier LTU.

Belgium's minister for state-owned companies Rik Daems says SAir has kept its promise in providing BFr6 billion ($140 million) in fresh capital for Sabena (augmented by BFr4 billion from Belgium), although there appear to be doubts over a remaining sum of BFr20 billion. SAir aims to clarify its involvement with Sabena and other investments before it reveals the full extent of its losses on 2 April.

SAir's 71%-owned subsidiary Crossair has meanwhile issued a unilateral statement in which it attempts to distance its management and financial performance from SAir's problems. Crossair says that while it took a SFr25 million ($15 million) operating loss last year, the figure is "an honest, non-embellished result with no cosmetics and no sale of assets", and pledges to retain its own board and new chief executive André Dosé.

Source: Flight International