Air Jamaica Sold
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Air Jamaica Sold
Air Jamaica sold - First murmurs about who has bought the national carrier have surfaced
Published: Saturday | July 4, 2009
Janet Silvera, Senior Gleaner Writer
WESTERN BUREAU:
The Gleaner has learnt that Indigo Partners and Oaktree Capital, who are reportedly the owners of Spirit Airlines, have bought the country's national carrier, Air Jamaica.
It is further understood that Air Jamaica's name might be changed to Spirit of Jamaica.
Sources close to the negotiations are tight-lipped, but they have confirmed that Trinidadian-owned Caribbean Airlines did not win the bid to take over the Jamaican airline.
The news comes days after the Privatisation committee, which has been managing the task of privatising Air Jamaica, submitted its recommendation to Senator Don Wehby, minister without portfolio in the Ministry of Finance.
It also comes at a time when the airline is reporting an operational surplus for the first time in 10 years.
On Tuesday, Wehby disclosed that the Privatisation Committee, chaired by Dennis Lalor, had submitted to him the evaluation and recommendation report on the privatisation of the national carrier.
In a media release, the minister said that the committee - assisted by expert input from the International Finance Corporation, which is the private-sector arm of the World Bank Group, and which has a record of more than 150 successful assignments in some 60 countries - had negotiated strategically with the two top investor prospects and had made a final recommendation for the signing of a document of agreed terms with one party. The terms include a provision for the Government of Jamaica to maintain a minority equity stake in the airline.
Some stakeholders in the tourist industry would not be disappointed with this outcome. Many have confided that this would be good move on the part of the Air Jamaica divestment team.
"Spirit is already mean and lean and that is exactly what Air Jamaica needs in order to strategically grow," said one hotelier, adding that the routes plied by both carriers might be complementary.
Strategic investment
Earlier, Spirit had announced the completion of a strategic investment, led by Indigo Partners LLC and funds managed by Oaktree Capital Management LLC. The investment will provide significant resources for the company to consolidate its position as the leading low-cost carrier to the Caribbean, and pursue its long-term growth strategy.
Indigo Partners LLC, with offices in Phoenix, Arizona and Singapore, is a private-equity fund focused primarily on investing in the transportation, airline and airline-related sectors globally.
Oaktree Capital Management LLC is a Los Angeles-based private investment firm that manages in excess of US$30 billion in select niche investment markets
for institutions and wealthy individuals.
Published: Saturday | July 4, 2009
Janet Silvera, Senior Gleaner Writer
WESTERN BUREAU:
The Gleaner has learnt that Indigo Partners and Oaktree Capital, who are reportedly the owners of Spirit Airlines, have bought the country's national carrier, Air Jamaica.
It is further understood that Air Jamaica's name might be changed to Spirit of Jamaica.
Sources close to the negotiations are tight-lipped, but they have confirmed that Trinidadian-owned Caribbean Airlines did not win the bid to take over the Jamaican airline.
The news comes days after the Privatisation committee, which has been managing the task of privatising Air Jamaica, submitted its recommendation to Senator Don Wehby, minister without portfolio in the Ministry of Finance.
It also comes at a time when the airline is reporting an operational surplus for the first time in 10 years.
On Tuesday, Wehby disclosed that the Privatisation Committee, chaired by Dennis Lalor, had submitted to him the evaluation and recommendation report on the privatisation of the national carrier.
In a media release, the minister said that the committee - assisted by expert input from the International Finance Corporation, which is the private-sector arm of the World Bank Group, and which has a record of more than 150 successful assignments in some 60 countries - had negotiated strategically with the two top investor prospects and had made a final recommendation for the signing of a document of agreed terms with one party. The terms include a provision for the Government of Jamaica to maintain a minority equity stake in the airline.
Some stakeholders in the tourist industry would not be disappointed with this outcome. Many have confided that this would be good move on the part of the Air Jamaica divestment team.
"Spirit is already mean and lean and that is exactly what Air Jamaica needs in order to strategically grow," said one hotelier, adding that the routes plied by both carriers might be complementary.
Strategic investment
Earlier, Spirit had announced the completion of a strategic investment, led by Indigo Partners LLC and funds managed by Oaktree Capital Management LLC. The investment will provide significant resources for the company to consolidate its position as the leading low-cost carrier to the Caribbean, and pursue its long-term growth strategy.
Indigo Partners LLC, with offices in Phoenix, Arizona and Singapore, is a private-equity fund focused primarily on investing in the transportation, airline and airline-related sectors globally.
Oaktree Capital Management LLC is a Los Angeles-based private investment firm that manages in excess of US$30 billion in select niche investment markets
for institutions and wealthy individuals.
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Spirit is too understaffed in HQ to manage another carrier. Additionally, according to Spirit management, Spirit is being forced by their ownership (Indigo Partners/Oaktree Capital Management) to survive without any additional funding. Spirit has, again according to Spirit management, somewhere around 80 MillionUSD in the band which is earmarked for deposits on new A320's.
All of which tells me that Spirit is NOT buying AirJamaica. Indigo/Oaktree is attempting to buy AJ.
William Franke, the Chairman of Indigo and Tiger Airlines, ex CEO of AmericanWest, will be in charge of AirJ.
Make NO mistake, Mr. Franke is the man with the money and the iron fist.
All of which tells me that Spirit is NOT buying AirJamaica. Indigo/Oaktree is attempting to buy AJ.
William Franke, the Chairman of Indigo and Tiger Airlines, ex CEO of AmericanWest, will be in charge of AirJ.
Make NO mistake, Mr. Franke is the man with the money and the iron fist.
It is offcial, NKS bought AJ!!!!
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I am sure that a number of groups are happy that Caribbean Airlines wasn't the successful bidder.
Today 01:42
Today 01:42
Whatever happens,.. happens!
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Interesting development of Spirit owners buying AJ!
Let me speculate a little: AJ probably has route rights throughout the Caribbean, which were no doubt part of the sale.
Perhaps Spirit will now do what many of us were advocating years ago but was deemed politically impossible: they will spread through the Caribbean and become the dominant force and after all the money losing local carriers that are too proud to work together have withered away, air transport decisions for the region will be made up in the USA instead of where they should be made; right here in our region.
Tragic
Let me speculate a little: AJ probably has route rights throughout the Caribbean, which were no doubt part of the sale.
Perhaps Spirit will now do what many of us were advocating years ago but was deemed politically impossible: they will spread through the Caribbean and become the dominant force and after all the money losing local carriers that are too proud to work together have withered away, air transport decisions for the region will be made up in the USA instead of where they should be made; right here in our region.
Tragic
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Street
I am sorry for AJ, if in fact NKS bought it, there will be a lot of people on the streets, cutting budget and expenses.... you know how the ULCC really work, making somebody do the job of three or more employees.
Sorry guys/girls from AJ...............
Sorry guys/girls from AJ...............
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It wouldn't have been painless had Caribbean Airlines bought them either.
When BWIA was shut down and morphed into CAL, they shrank the airline too much, got rid of too many pilots and when they tried to expand, found that most of those pilots had moved on.
But hopefully they would have learned some lessons along the way and might have handled it differently.
I still feel that an ATTEMPT should have been made, once and for all, to have a regional airline but as Panama Jack said earlier....
"I am sure that a number of groups are happy that Caribbean Airlines wasn't the successful bidder."
Island politics.............................
When BWIA was shut down and morphed into CAL, they shrank the airline too much, got rid of too many pilots and when they tried to expand, found that most of those pilots had moved on.
But hopefully they would have learned some lessons along the way and might have handled it differently.
I still feel that an ATTEMPT should have been made, once and for all, to have a regional airline but as Panama Jack said earlier....
"I am sure that a number of groups are happy that Caribbean Airlines wasn't the successful bidder."
Island politics.............................
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Personally I think it's sad that the National Flag carrier from Trinidad & Tobago has decided to call itself "Caribbean Airlines". The airline does not hire pilots from any other Caribbean nations. Those that are there were there from when they hired during the shortage. The website now states "Trinidad & Tobago Nationals". It is a Caribbean Airline, it is NOT the airline of the Caribbean.
A lot of people, including flight crew still working there. HR department was unimpressive last I checked. Even in this economic downturn you have pilots leaving to the ME. If you're not from Trinidad you probably don't want to live there.
Good luck to AirJam I hope that one day I'll get on one of the Airlines from the Caribbean on my way home and feel like I did when I used to step on a BWIA aircraft. Somehow I highly doubt this...
A lot of people, including flight crew still working there. HR department was unimpressive last I checked. Even in this economic downturn you have pilots leaving to the ME. If you're not from Trinidad you probably don't want to live there.
Good luck to AirJam I hope that one day I'll get on one of the Airlines from the Caribbean on my way home and feel like I did when I used to step on a BWIA aircraft. Somehow I highly doubt this...
July 24th,
Published in Trinidad....
"Caribbean Airlines has also put in a bid to acquire cash-poor Air Jamaica, which has been struggling to stay in the air for the past couple years because of the international downturn in tourism-related travel.
Sources confirmed last night that Caribbean Airlines has bid for the Jamaican airline, in a deal that would require a cash injection to start operating a new entity.
The deal would require the Jamaican government to close Air Jamaica and pay staff members severance, since Caribbean Airlines would not be interested in taking on debt from the Jamaican carrier, an industry source said in a phone interview last night.
Caribbean Airlines had made the bid for Air Jamaica about a month ago. Spirit Airways, a low-budget international carrier, is also bidding to acquire Air Jamaica. No deal has been finalised as yet, the source said."
Published in Trinidad....
"Caribbean Airlines has also put in a bid to acquire cash-poor Air Jamaica, which has been struggling to stay in the air for the past couple years because of the international downturn in tourism-related travel.
Sources confirmed last night that Caribbean Airlines has bid for the Jamaican airline, in a deal that would require a cash injection to start operating a new entity.
The deal would require the Jamaican government to close Air Jamaica and pay staff members severance, since Caribbean Airlines would not be interested in taking on debt from the Jamaican carrier, an industry source said in a phone interview last night.
Caribbean Airlines had made the bid for Air Jamaica about a month ago. Spirit Airways, a low-budget international carrier, is also bidding to acquire Air Jamaica. No deal has been finalised as yet, the source said."
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Actually, there are two pilots employed with Caribbean Airlines who are from another island in the caribbean and neither holds a T&T passport. I agree there should be more.
And there are over seventy ex Beewee pilots scattered around the world, who through no fault of theirs, have had to find new homes. Don't expect Caribbean Airlines to offer jobs to "non nationals" when they treated their own so poorly.