HERMAN DE WULF / BRSUSSELS
A take-over would consolidate the German tour operator's position in the Belgian market
German tour operator Preussag has emerged as a potential buyer of Belgian charter airline Sobelair. The carrier is part of the asset fire sale being undertaken by Sabena in an effort to raise fresh capital to stave off increasing financial problems. Despite the airline's parlous position, Sabena pilots have announced they intend to strike in protest at the airline's restructuring plan.
Preussag is Sobelair's main customer and a take-over would consolidate its position in the Belgian market. Sabena has confirmed the Preussag interest but has declined to comment further ahead of any agreement. The German company already owns leading European charter airlines Hapag-Lloyd and Britannia.
One of the subjects under discussion between the two parties is Sobelair's ownership of the Air Belgium brand name following the demise of the Airtours-owned charter airline last year.
The sale is part of the flag carrier's efforts to raise BFr40 billion ($900 million) to recapitalise and restructure. The Belgian Government and Swissair Group, which respectively own 50.5% and 49.5% of Sabena shares, have agreed to inject a further BFr10 billion. The remainder has to be found by cost-cutting and the sale of profitable subsidiaries in areas such as maintenance, catering and hotels.
Despite the airline having lost BFr70 billion over the last 25 years, the Belgian Cockpit Association, the local pilots' union, has announced that members intend to strike on 30 August in protest at company restructuring plans. Resulting redundancies will involve around 1,600 employees, including around 200 pilots.
Among their demands the pilots want Sabena to terminate immediately outsourcing flights to Virgin Express, and replace them with their own aircraft and crews. The Brussels-based low-fare airline serves a number of routes, with Sabena undertaking a block space deal.
Sabena has already admitted that the deal is no longer in its best interest. However, Virgin Express says it has watertight contracts that do not start to expire before 2004. Breach of contract by Sabena would be a serious blow for Virgin Express and would represent a considerable loss of income almost certain to result in claims for sizeable damages.
Sabena has already prematurely ended a long-term contract with local carrier City Bird, which cost the flag carrier an estimated BFr1.5 billion in damages for breach of contract.
Source: Flight International
