Mozambique is seeking a buyer for a 51% stake in the national airline Linhas Aereas de Mocambique (LAM), a government official said on Monday.
”The government is looking for a partner who will bring a new dynamism to counter the challenges faced lately by the world’s civil aviation industry,” said the national director of infrastructure in the ministry of transport and communications, Estevao Uamusse.
The government currently holds an 80% stake in LAM, with the remaining shares belonging to employees and management. After a first privatisation attempt failed in 1996, LAM was transformed from a state company into a limited liability company in which LAM employees acquired a 20% stake.
LAM has run below profit in recent years, and only covers a limited regional and international market, with flights to South Africa, Zimbabwe and Portugal.
The company’s financial situation worsened following the September 11 attacks in the United States, which reduced travellers’ confidence on the civil aviation industry, Uamusse said. Consultants are preparing tender documents for the sale, he added.
Uamusse, who also heads LAM’s privatisation commission, said the company has also accumulated heavy debts, the largest being a $36-million debt to the US plane manufacturer Boeing for plane hire.
Uamusse said LAM is negotiating the debt with the manufacturer, with the possibility of securing sale of a Boeing 767 to the Cape Verde’s airways.
”The Cape Verdians have expressed interest in acquiring the plane and, should we strike a deal, LAM would only have to pay the difference to Boeing — about eight-million US dollars,” he said. Until now, Mozambique’s government has considered LAM a strategic company that it would not privatise.
More than 1 000 companies have been sold since the privatisation process began in the early 1990s under the structural adjustment programme backed by the World Bank and the International Monetary Fund (IMF). – Sapa-AFP