Russia’s S7 airline has acquired a 51 percent share in Transaero, the biggest private airline in the country. The price of Transaero stock almost tripled on the news.
“The CEO and co-owner of the group has signed an agreement to purchase at least 51 percent of Transaero,” said a spokesman for S7, refusing to give further comment.
Transaero shares surged to 19.5 rubles (about 30 cents) per share as of 12:44pm MSK, almost tripling in value.
The deal seems ambiguous, as Transaero has accumulated $4 billion in debts and will have its license revoked next Monday.
Lack of information from S7 leaves it uncertain whether the airline wants to keep Transaero as an independent company or to consolidate it within S7.
Analysts from Russian brokerage firm BKS say the purpose of the deal was to improve S7’s position in the struggle for Transaero’s assets and not an attempt to rescue the distressed airline.
Transaero, the second biggest airline in Russia, has been unable to service debts, which total about $4 billion, including leasing obligations. It has stopped selling tickets and is about to lose its license. Transaero passengers are being carried by state-owned Aeroflot and other carriers. A number of Transaero creditors, including Sberbank and Alfa-Bank, have filed for the airline’s bankruptcy.
The Russian government has made it a priority to help find jobs for the more than 11,000 Transaero staff and help stranded passengers fly to their destinations.
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CityJet chooses Sukhoi Superjet for Avro RJ replacement
MOSCOW/DUBLIN (Sputnik) — CityJet, an Irish regional airline, said Tuesday that it had opted to buy at least 15 SSJ100 planes in a 98-seat configuration from Superjet International to renew its aircraft fleet.
“CityJet has agreed to take four aircraft in 2016 with the delivery of an additional 11 throughout 2017. The airline has also taken options on an additional ten aircraft,” the company said in a statement.
“We are very excited to be the very first airline in Europe to order this “game-changing’’ aircraft that delivers a level of comfort, plush interior design and cabin capacity that is far superior to all of its competitors,” CityJet Executive Chairman Pat Byrne said.
The Russia-produced SSJ 100 is the first aircraft in its class to offer five abreast seating combined with a cabin height of over 2 meters.
According to Byrne, the “versatile new generation jet” will fulfill the company’s requirements to operate at smaller airports such as the London City Airport and offer “significant advantages” in fuel efficiency, emissions ratings and noise reduction.
The airline intends to introduce the SSJ100 on charter activity in 2016.
Sputnik News
Sukhoi Civil Aircraft (SCA) and Irish European regional airline CityJet have signed an agreement on 15 firm orders for delivery SSJ-100 plus an option for 10 more, SCA said in a press release.
“The deal is worth more than $1 billion at the aircraft’s contract price, including options and related services. The deliveries are due to begin in Q1 2016,” SCA said. Four should be delivered in 2016 and the other 11 by the end of 2017.
“CityJet plans to use the SSJ-100 instead of the Avro RJ85 for flights to Europe, including London City Airport. The SSJ-100 will be certified to fly to London City by the end of 2016,” SCA said.
SCA is also in talks with EgyptAir to supply an initial 12 SSJ-100 with an option for 2 more.
Russia Beyond The Headlines
Virgin Atlantic looking into serving Moscow
Virgin Atlantic wants to take over the London-Moscow route from EasyJet, according to founder Richard Branson in an interview with the Sputnik news agency.
Branson said the company became interested after EasyJet announced plans it would stop flying to Moscow next year.
“We are actually looking at possibly trying to fly to Moscow at the moment because EasyJet has just stopped flying, so we are actually thinking about maybe taking their license and flying to Moscow… So that’s possible,” he said on the sidelines of the UN General Assembly.
EasyJet, the only budget airline flying between Moscow and London, announced in September it was planning to end flights to Russia in March 2016 due to lack of demand, instability in the Russian economy and the tightening of the visa approval procedures.
According to the Russian-British inter-governmental agreement on flights between the two capitals, each country may be represented by a maximum of two carriers. Currently, they are Aeroflot and Transaero from Russia and EasyJet and British Airways from the UK.
In 2012, Virgin Atlantic lost the bid to EasyJet to fly to Moscow.
Last year, Virgin Atlantic reported revenue of £2.9 billion (about $4.4 billion), and flew over six million passengers.
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