Centralwings to float on stock market after LOT IPO
Polish Treasury Ministry is planning to sell Centralwings (the budget orientated subsidiary of the national airline LOT) with one of the planned scenarios being an Initial Public Offering. Ireneusz Dabrowski, Polish deputy treasury minister, said that an IPO for LOT is planned for 2007. The Treasury Ministry would retain a controlling stake in the firm. Following the flotation of LOT, the ministry wants to solve the issue of Centralwings. C0's current strategy is moving into the black at the end of 2008, something that could not be achieved without an injection of capital. "There are offers of investors willing to take over the company, so it might be sold in full," said Dabrowski. The name of a potential investor(s) hasn't been disclosed yet. Personally I don't believe Ryanair could be one of them, nevertheless Mr. Dabrowski has some restraints if it was the case: We should enable any offer made by Ryanair to be rejected, as Centralwings is to compete with the cheap Irish airline". The prospect of privatization of Lot and/or Centralwings is not enthusiastically seen in both firms either. And even the Minister says it might not be possible to make C0's privatization happen before 2008. That, however, could be also too late, as Centralwings' financial shape is poor and LOT results deteriorate as well.