The ongoing privatisation process of fifteen state-owned companies has this last week seen the emergence of a strong Polish presence in Slovenia, with Paloma tissue products and Adria Airways Tehnika(AAT), two of the publically-held enterprises that have proved easier for the government to offload, passing into the hands of companies registered in Poland.
Paloma’s acquisition has made fewer headlines but it is more widely known overseas than the Brnik-based aircraft maintenance operation, with many British consumers familiar with the instantly recognisable orange-packaged tissues found in so many toiletry stores. The two shareholders of Adria Airways Tehnika – Aerodrom Ljubljana(AL) and state-vehicle Slovenia Sovereign Holding – have agreed to sell their respective 47.67% and 52.33% share of AAT to Linetech Holding, who tabled the best bid in a process widely regarded as transparent and keenly fought. Fraport effectively inherited their holding in AAT on acquiring Slovenia’s primary airport in 2014 but have decided to cash in their stake, somewhat offsetting the significant purchase price of Brnik and notable improvements the German-based airport operator have undertaken during the last year. A labyrinthine, circuitous route of ownership has finally seen AAT completely denationalised from its embryonic status as a standalone company since being uncoupled from Adria Airways in 2010, after initially being sold to the state and Aerodrom Ljubljana as a means to aid the perpetually ailing flag carrier. AL itself was eventually sold to Fraport who were bequeathed Adria Airways Tehnika as part of the deal.
Despite generating revenues of €18.5 million to the year ending 2014 only a peppercorn profit of €30,000 was turned, indicating that whilst Adria Airways Tehnika is a thriving and proficient enterprise with a strong order book, much work remains to be done by its new owner to draw out a greater yield from turnover estimated as €20-22 million for 2015. The encouraging aspect of Linetech’s purchase of AAT is the deep rooted experience in the aircraft maintenance industry that the Warsaw-based company will bring to the acquisition, in contrast to being appropriated by a Hedge Fund where economies including redundancies are often the precursor to a quick resale. The privatisation process of Slovenia’s gang of fifteen has at times been fraught and often beset with interminable delays, although the country’s incumbent administration have persevered with divesting the state of publically-owned concerns that so often have been a financial drain on a country that has at times struggled against the threat of default. The genuine litmus test of success will though be in its disposal of Adria Airways itself, for too long engaged in the longest of goodbyes whilst Slovenia frantically attempts to severe the most Gordian of knots that has increasingly resembled umbilical life-support.
Further reading on the latest privatisation news affecting Slovenia can be viewed at: