Air Jamaica divestment delayed

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Air Jamaica divestment delayed

Unread post by bimjim » Mon Mar 23, 2009 ... lead2.html

Air Jamaica divestment delayed
Published: Sunday | March 22, 2009

The Sunday Gleaner has learnt that the Government is now looking to close the Air Jamaica divestment deal before the end of the first quarter.

This has not been officially confirmed, but the minister with responsibility for the airline, Don Wehby, has disclosed that the March 31 deadline will not be met.

"The (Air Jamaica) Divestment Committee remains confident that it can complete this task within a short time. Our original deadline of March 31 is drawing closer, and while we do not foresee ourselves finalising a deal with an investor by then," Wehby says in an article published elsewhere in this newspaper, "we are satisfied with the progress being made and are heartened by the fact that we have already received an initial proposal from one prospective investor.

"That proposal specifies terms they would agree to with the Government and we are engaged in ongoing negotiations with them," Wehby adds.

The Bruce Golding administration had made it clear that it did not want to include any financing for Air Jamaica in the 2009-2010 Budget now being crafted.

But with the failure to find a buyer to meet the March 31 deadline, the administration will have to cough up money to help keep the ailing Love Bird flying.

However, if the sale is done within the first quarter, this would be substantially less than the approximately US$30 million which taxpayers have had to pump annually into the debt-ridden airline over the past many years.

The airline's management team is also expecting the recently introduced business plan to reduce the bleeding, which has resulted in a debt of US$652 million and accumulated losses of more than US$1 billion.

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