Quote: Austrian CEO Alfred Otsch has struck out at Sheikh Mohamed Bin Issa Al Jaber’s threat to pull his new investment, labelling the move as incomprehensible and rejecting all allegations of deception.
Saudi investor Al Jaber is due to take 20% of Austrian but, through his lawyers, he is now threatening to withdraw from the agreement claiming the airline provided misleading information over its position.
Otsch says: “The exit that is now in the air and the reasons given for this are not comprehensible for us in any way. Also, I am personally deeply disappointed. Despite this development, we expect that Sheikh Al Jaber will comply with the contract.
“If this should not take place, we shall undertake appropriate steps in order to preserve our rights. I again emphatically reject the allegation of deception, it is completely unfounded.
“Constructing this as a reason for exist is astonishing, as the investor still intended to increase his commitment by a further 4.9%, taking advantage of the low share price, in the knowledge of the already disclosed results of the first quarter of 2008.”
Despite the brewing rift, Otsch insists that Austrian will stick by its ownership-neutral strategy. The airline will continue to focus on its core markets in central and eastern Europe and push forward with its Middle East growth plan.
Otsch says: “Even without the investment of Al Jaber, we will find ways in the future to sustainably occupy this market successfully.
“We also have the financial strength to do this, the lion’s shares of economic losses were eliminated last year, we have a good strategic positioning and capitalise on our competitive advantages. Due to the difficult industry situation, we will undertake measures to secure profitability.”
Would like to know from Austrian ANetters the impact on the airline on the above.
AustrianZRH From Austria, joined Aug 2007, 1264 posts, RR: 0 Reply 1, posted (5 years 2 weeks 20 hours ago) and read 1845 times:
Well, the main problem with OS is that everything is political. That goes as far as sometimes in the past, defeated candidates of presidential elections got some jobs on the board... Due to the ÖIAG (partly state-owned Austrian industry holding) owning the majority of OS shares, everything needs to be balanced - not on the bank account but concerning the equilibrium between social-democratic and conservative board members. All that leads to a massively overgrown administration and management who partly have no real qualification.
yes, they are, but I can't believe the Austrian government will allow the airline to go down, even if they have to inject the taxpayer's money. However, I'd much prefer a qualified management not needing any government money...
It's all a pity, as I read many trip reports on OS's high quality on A.net. Unfortunately, I've never been able to fly them as I live in ZRH and have always lived closer to ZRH and MUC than to VIE. Definitely want to try them someday, though!
WARNING! The post above should be taken with a grain of salt! Furthermore, it may be slightly biased towards A.
Quote: Austrian Airlines said it had extended to May 21 a deadline for investor Sheikh Mohamed Bin Issa al Jaber to provide a bank guarantee for his plan to take a major stake.
The guarantee had been due by the end of Monday.
In a deal announced in March, the Saudi-Austrian investor was to take a 20 percent stake in the airline via a capital increase for about 150 million euros ($230 million) but the deal had run into trouble.
The statement appeared to open the way for further talks after the airline's main stakeholder, state holding company OeIAG, said on Monday night talks had broken up over "conditions that were impossible to fulfil."
Tuesday's statement from the airline still accused al Jaber of maliciously claiming to have been misled. It rejected the allegations.
Al Jaber threatened to pull out after the airline posted a first-quarter EBIT loss of 50.1 million euros in April, much worse than expected, sending the shares sliding.