Montenegro Airlines, which has been shortlisted for privatization this year, is eyeing closer ties with Etihad Airways and has recently launched fresh talks with the Emirati carrier. The news comes almost a year after Montenegro’s Deputy Prime Minister and Foreign Minister, Igor Lukšić, said Etihad was considering acquiring a stake in the country’s national airline.
According to the state-owned “Pobjeda” newspaper, the two carriers are now looking to conclude a codeshare partnership agreement and boost cooperation, with talks recently held in Abu Dhabi.
The involvement of Serbia’s Deputy President for Cooperation with the UAE, Mladjan Dinkić, who is heading the talks between the two parties has generated significant attention. Mr. Dinkić, who is also Serbia’s former Finance Minister, played an important role in Etihad’s takeover of Jat Airways, which was subsequently relaunched as Air Serbia.
Last year, Mr. Lukšić and Etihad Airways’ CEO, James Hogan, met in Abu Dhabi after which the minister said the Emirati carrier would complete a screening process of the Montenegrin airline. “We have made a definite agreement for a team from Etihad Airways to visit Montenegro in order to define models of cooperation and partnership between Etihad Airways and Montenegro Airlines”, Mr. Lukšić said at the time. Montenegro Airlines has been hit by strong competition over the past year on its two main markets – Serbia and Russia – which accounted for 62.8% of all passengers it carried last year. The airline handled some 557.000 travelers in 2014, down 5.3% on the year before and decreased its flight operations by 20%. However, Montenegro Airlines says it is holding up against its competitors, “Strong competition over the past two years hasn’t managed to jeopardize Montenegro Airlines’ position as one of the most punctual airlines in the region”, the carrier said in a statement.
Earlier this month, the Montenegrin Privatisation and Capital Investment Council announced plans to privatize Montenegro Airlines this year. The Ministry for Transport and Maritime Affairs has offered to sell a minority stake in the airline, which is to be offered to potential investors through an international tender. Both attempts to privatize the carrier in the past have failed, though Ettihad has previously expressed interest to invest in Montenegro Airlines. During the 2011 privatization attempt, in which the government was looking to sell a 30% stake, Etihad purchased tender documentation. However, it failed to place a bid later on. Etihad Airways currently counts eight equity alliance partners in which it holds ownership stakes, with its takeover of Darwin Airline, rebranded as Etihad Regional, still to be approved by Swiss authorities.