Tuesday 12 December 2017

CityJet to be sold to Intro as talks revived

Nick Webb

Nick Webb

Stalled talks to sell Dublin airline CityJet between owner Air France KLM and German group Intro Aviation GmbH are understood to have been revived in recent days.

Last June, Air France agreed to sell the airline to Intro but talks hit the skids with a period of exclusivity ending without agreement.

It has been suggested that Air France may pay off CityJet's debts as part of the new sale process. With this roadblock cleared, it is thought that a deal could be agreed within the next month.

CityJet has been on the block since September last year, as its owner Air France-KLM restructured its regional operations, which had been haemorraging money.

CityJet, which was set up by entrepreneur Pat Byrne, has a fleet of 38 aircraft providing more than 480 weekly flights across Europe, its website says.

Most recent financials show that the Irish airline made a €209m loss in 2012 but received a €185m capital injection from Air France Finance.

Air France bought the airline in 2000 aiming to use it to feed passengers into its Paris hub for long-haul traffic. The deal enabled Air France to run the airline in Ireland without incurring major French labour costs. It hasn't made an operating profit since 2007.

Regional airlines across Europe have been hammered by rising costs and weaker demand since the economic crisis erupted. Hungarian airline Malev and Spanair in Spain went out of business in 2012, with Padraig O Ceidigh's Galway-based Aer Arann rescued out of examinership by British transport group Stobart. Loss-making British regional flyer BMI was also taken over by British Airways.

Sunday Independent

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