Officials have told Mexico's third largest airline to improve its financial viability by raising $130 million in new capital within the next 90 days. Taesa is putting a positive spin on the conclusions of a government audit by using them to entice investors.
The investment order is the toughest of 69 conditions imposed on Taesa by the secretariat of transport and communications (SCT) before it allows the airline to resume operations. Taesa was grounded after a crash in November.
The SCT based its capitalisation requirement on a finding that the condition of Taesa's aircraft caused numerous delays and a decline in service standards.
Taesa hopes to turn the government's audit into a prospectus for potential investors. Eduardo Cacho, assistant to Taesa's president, says the airline has complied with 95% of the conditions, including scrapping all five of its McDonnell Douglas DC-9-15s and one Boeing 727-100, leaving it with 21 jets.
Cacho says the audit is as thorough as any due diligence and should remove doubts by potential investors. He says Alberto Abed, Taesa's chief executive and majority shareholder, is willing to yield control. According to Cacho, "two groups of investors are interested".
Taesa has complained that a rival union which wants to oust the flight attendant union managed to falsify log books to make trouble, that the government's audit was more thorough than required, and the investigation has taken too long. The airline is anxious to resume operations before the end of the peak travel season. TAESA estimates it lost $22 million up to mid-December.
Source: Airline Business
