30 MILLION US DOLLARS NEEDED TO SETTLE AIR SEYCHELLES DEBT TO ‘PARTNER‘ ETIHAD
(Posted 15th November 2019)
Information coming from the Seychelles suggests that the government is seeking ways and means to secure a bank loan which will permit Air Seychelles to pay an accumulated debt to partner Etihad, itself an airline now struggling with losses after a failed expansion programme under their former management brought them to the bring of financial collapse.
The partnership between the two airlines was struck in 2012, when indeed Etihad at the time came to the rescue of Air Seychelles and the early years of cooperation saw Air Seychelles’ operations stabilize while Etihad ‘absorbed‘ key functions like maintenance and training, among others, benefitting from the arrangements.
Agreements of 2018 between the airlines and the government of Seychelles as an interested party apparently then brought about the requirement to inject some 30 million US Dollars into the airline over the space of several years and since Etihad refused to accept a sovereign guarantee is there now the urgent need to have a leading bank or banking consortium underwrite the funding.
As part of the deal is the Seychelles government also to guarantee that Air Seychelles will retain a handling monopoly at the International Airport on Mahe and the local airport on Praslin, allowing the airline to retain a major cash flow pipeline.
Air Seychelles presently operates one Airbus A320neo and a classic Airbus A320, the latter being exchanged against another A320neo by end Q1 or early Q2 next year. The airline flies these aircraft to Johannesburg, Mauritius, Madagascar and Mumbai while their domestic fleet of De Havilland Twin Otter serves Praslin with more than 20 daily scheduled flights and other islands with charters.