LETA: Dombrovskis: Takeover of ''airBaltic'' shares was best solution in regard to national interests
30 November 2011
Commenting the Transport Ministry's actions yesterday in taking over the shares of ''airBaltic's'' minority shareholder, Prime Minister Valdis Dombrovskis said that this was the best solution in regard to the best interests of Latvia. ''This was the best possible solution to protect the interests of the state,'' the prime minister's press secretary Martins Panke informed LETA.
As reported, The Transport Ministry yesterday, using its pre-emptive right, bought national airline "airBaltic" shares that previously belonged to "Baltijas Aviacijas sistemas" (BAS), a minority shareholder, but were pledged as security with "Latvijas Krajbanka", as LETA learned from the ministry.
The Transport Ministry informs that the shares were acquired in order to protect the interests of the state pursuant to the Cabinet of Ministers' November 29 decision to accept "Krajbanka's" offer to buy out these "airBaltic" shares.
According to the government's decision, the Transport Ministry has bought 47.2 percent of "airBaltic" shares, which BAS pledged as security with "Krajbanka", for the nominal value of the shares, LVL 224,453, and the sate now therefore holds 99.8 percent of "airBaltic" shares.
In making the decision, the government took into consideration risks established by the financial consulting company "Prudentia" and the Transport Ministry regarding the further development of "airBaltic" and protection of state interests in the wake of the collapse of the Lithuanian bank "Snoras" and its subsidiary "Krajbanka", as these two banks played a crucial role in guaranteeing the solvency of BAS.
According to an analysis by "Prudentia", there is a substantial risk that BAS will not be able to honor its October 3 agreement with the government on increasing "airBaltic" share capital. The government decided to make sure that the financial problems of BAS do not affect the planned investments in "airBaltic" share capital, and to act proactively in order to protect the interests of the state, taking over the minority shareholder's stake in "airBaltic".