Airport, Latvia, Legislation, Transport

Uldis Augulis.

Augulis explains that the government has delegated him to terminate airBaltic shareholders agreement before the airline's shareholders meeting, writes LETA.

"This is very important and the ministry has already drawn up the documents so a new board and new council could be elected for the airline. The board, pursuant to normal business practice, will include three members so that the airline is not managed by just one person," stressed Augulis.

"Today, agreement must be reached on the shareholders' agreement because the shareholders meeting is due tomorrow," stressed the minister.

The shareholders' meeting tomorrow may become a turning point, when "we will see how far we have come."

"I believe that if there is normal cooperation between the shareholders, there will be no obstacles to solve the problem," said the minister.

As reported, during a closed Cabinet meeting yesterday, the government agreed to allocate LVL 57.6 million to increase the share capital of airBaltic.

If airBaltic's minority shareholder fulfills its conditions, Augulis has been given the authority to sign such an agreement.

The state funding will be provided as a loan from the State Treasury, with the possibility that at least some part of it could be capitalized, Prime Minister Valdis Dombrovskis (Unity) told reporters yesterday. The investment by the minority shareholder, Baltijas Aviacijas sistemas, will be proportionate to its stake in the airline, which means around LVL 50 million. This money will be used to cover the airline's operating losses this year and partly next year. Also, part of the funding will be used for modernization of the airline's fleet.

On September 29, an airBaltic shareholders meeting is to be held, during which decisions on increasing the airline's share capital will most likely be made, as well as changes to the airline's board and council, as well as to the shareholders' agreement.