ECONOMYNEXT – Sri Lanka is making plans to attract a foreign investor by offering a 49 percent stake and taking off some of the debt off the balance sheet of the airline who will need to invest at least 250 million US dollars to modernize the airline, an official has said.
Sri Lanka’s Public Private Partnership Agency has prepared an information memorandum which can be offered to prospective investors after a cabinet appointed negotiations committee approves it and required policy decisions are made, PPP agency chairman Thilan Wijesinghe said.
Talks are ongoing with the department of external resources to get 500 to 600 million dollar re-financing facility from the Asia Infrastructure Investment Bank take the debt out of the SriLankan Airlines balance sheet, , he told a parliamentary committee on public enterprises.
It will be placed in a a special purpose vehicles which to be repaid in 20 years. No investor would come to the airline with its current level of debt, he said.
The airline however could go forward with about 200 million US dollars of debt, he said.
The current board was also implementing a re-structuring plan to reduce debt by another 100 million US dollars.
The airline had close a billion US dollars in debt, officials said.
A CANC had been appointed chaired by Mahaweli Ministry Secretary Anura Dissanyake, a Deputy Treasury Secretary and three others.
A 7-member project committee has also been appointed. Once required decisions are made a transparent process could be started to seek investors by September, he said. (Colombo/Aug22/2019)