Home Latest News Tata Sons touted as possible SriLankan Airlines investor

Tata Sons touted as possible SriLankan Airlines investor

SriLankan Airlines is one of several state-owned enterprises the government wants to privatise. However, it has become something of a political football with various agenda at play in Colombo. Speaking at a recent government committee on public enterprises hearing, SriLankan Airlines Chairman Ashok Pathirage was supportive of privatisation as long as the right buyer was found, while CEO Richard Nuttall said he was focused on replacing aircraft and rebuilding the fleet ahead of any privatisation.

Sri Lankan Airlines presently flies to the Indian airports of Bangalore InternationalChennaiDelhi InternationalHyderabad InternationalKochi International,MaduraiMumbai InternationalThiruvananthapuram, and Tiruchirapally from its Colombo hub. Based on seat availability data, SriLankan Airlines currently commands a 63.21% market share on the country pair.

Air India has the second biggest presence on Sri Lanka – India sectors, with a 13.68% market share. If Tata acquired a full or part stake in SriLankan Airlines, adding in Vistara’s 4.69% market share, its airlines would provide 81.58% of all seats on the country pair, which may or may not raise competitive concerns. The media reports suggest the SriLankan government is “considering” Tata Sons as a possible investor. ch-aviation has contacted Tata Sons for their response to the reports.

Meanwhile, SriLanka’s Secretary of Ministry of Ports, Naval and Aviation Services, K. D. S. Ruwanchandra, told the public enterprises hearing that the government agency handling the sale of SriLankan Airlines subsidiaries, SriLankan Airlines Ground Handling and SriLankan Catering, preferred to sell the two entities to one buyer. As previously reported in ch-aviation, the government hopes to raise approximately USD600 million selling 49% stakes in both profitable entities. However, that amount would only cover around half of SriLankan Airlines’ existing debt.


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