Airport, EU – Baltic States, Investments, Latvia, Legislation, Transport

BC's photo.

In his words, representatives of the agency, Transport Ministry and airBaltic will meet already this week at the Transport Ministry's initiative.

Ozols indicated that until now the Latvian Investment and Development Agency had not been involved in attracting investment for such major enterprises as airBaltic and Liepajas Metalurgs, which in Ozols' view has been a mistake.

"The state resource has to be put to use," Ozols said, stressing the agency's significant capacity, which includes 21 representations in foreign countries. Moreover, using the Latvian Investment and Development Agency's services would cost less than hiring private advisers. Although Ozols avoided to directly criticize Prudentia, a financial consultancy involved in several investment attraction processes, he said that so far the services provided by private organizations have not provided the desired results.

Ozols admitted, however, that since aviation is not the agency's specialization it might not prove as useful in attracting an investor for airBaltic as expected.

On November 3, 2015, the government approved an investor for the national airline airBaltic that had been suggested by the Prudentia consulting company – the German businessman Ralf Dieter Montag-Girmes. He will invest EUR 52 million into the airline, and in turn get a 20 percent stake in airBaltic, whereas the state will have to invest EUR 80 million in the airline. Increasing the share capital of airBaltic is necessary so it could pursue its business plan and modernize its fleet.

The shareholders' agreement with Montag-Girmes still has not been signed, however. As an airBaltic shareholder, the Transport Ministry is ready to sign the agreement with the German businessman already since December, but the potential investor still has not informed about his readiness to ink the contract.

The government has also ordered airBaltic to attract a strategic investor for the airline in two years' time.