Air Austral takes a stake in the capital of Air Madagascar
In trouble for several years, the Malagasy airline has launched in April 2016 a process to find a strategic partner able to save the company. 7 airlines companies showed their interest, among them Air Mauritius, Kenya Airways and Ethiopian Airlines. At the end, it is the French airline who was chosen by Air Madagascar. Air Austral has announced that they will bring 37 million Euros to help straighten things out for the Malagasy Airline. The agreement protocol between the two airlines has been signed Tuesday, 4th April. A win-win situation for the 2 companies.
“A historic turn”, this is how the CEO of Air Austral, Marie-Joseph Malé, qualify the agreement signed between the 2 companies. The French airline will take over 49% of Air Madagascar’s capital, the Malagasy state remains the majority stakeholder with 51%.
With this stake taking, Air Austral is now uncovered regarding its ambitions and wishes to become the 1st regional airline in this part of the Indian Ocean. “The Malagasy market is going to be a growth area”, said its CEO in an official release.
The last three profitable years testify of the stability and profitability of the French Airline. At the opposite, Air Madagascar is in a bad position for several years: strikes, overstaffing, technical difficulties, deficits, resignation of its CEO last January.
With this partnership, Air Madagascar hopes to “find back a financial stability but also enlarge its network at a local, regional and international level” said Leo Rajaobelina, chairman of the board of directors.
But before Air Austral takes a stake in Air Madagascar, the Malagasy airline must pay back its debts. In January, the former CEO spoke about a 70 million Euros of debts.
Source: RFI, 6th April 2017