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Breaking news30 July 2018 11:50

Air Moldova company was to be privatized many years ago - Public Property Agency says

The decision to privatize Air Moldova company was taken in 2008, but no action was taken in the meantime to put it in a position to privatize it. Air Moldova should be privatized several years ago, Vladimir Baldovici, Director General of the Public Property Agency (APP), told a press conference.

The head also said that Air Moldova was to be included in the privatization round in 2015, but there was no political consensus for the authorities to take the decision. “Today, the government takes the decision to privatize it, ” Vladimir Baldovici said. He noted that APP wants” total transparency “in the privatization of the largest airline in the Republic of Moldova, which holds 44.4% of the market.”

Referring to the initial privatization price of about 48 million, considered by some as “very small,” Vladimir Baldovici noted that Air Moldova is “an enterprise that requires large investments, the state cannot afford”. On the other hand, in just five months of this year, the debts amounted to 150 million lei and the total debts amounted to 1.2 billion lei. The investor who will purchase the airline will have to assume all obligations, including debts. Other commitments include maintaining the profile of the business, the brand and the Air Moldova team.

The official also said that only companies with experience in the field will be admitted, and two investors have already been interested.

He also noted that there is a tendency in Eastern and Western Europe to privatize state-owned airlines.

He referred to the Tarom company of Romania, where the state holds 95 percent of shares that in 2017 it generated losses of 37 million euros, and also examples from Norway and Finland.

In another context, Baldovici said that many companies put on the new round of privatization were exposed for 6-12 years without being requested, so the privatization method should be reviewed. The economic and financial situation of many of these businesses has not changed, and others are bankrupt.

On 27 July – 7 September, a commercial contest is organized for the privatisation of 12 enterprises. The largest enterprises that will be exhibited in the commercial competition are Chisinau Glass Factory, printing plant, hotel Zarea. The Air Moldova company will be put out for commercial competition. The initial price of the goods for the competition is 526 million lei. Cinemas Prut of Falesti and Patria of Leova will be exhibited repeatedly.

On 5 September, the auction will be held for the privatization of 16 real estate complexes, 12 state-owned enterprises and an unfinished object (deadline for submitting applications – 4 September, 16:00).

The total price of the auctioned goods is 63.4 million lei.

The price of privatization of state-owned assets under this round is 1,574,984,665 lei.



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