Yemenia (IY, Aden) commercial director, Mohammed Al-Mekhlafi, has refuted claims his airline owes the Kingdom of Saudi Arabia a share in its profits backdated to 1978 when Yemenia was founded.
Yemenia was formed in 1977 as a 51/49 joint venture between the national carrier of the then Yemen Arab Republic (YAR - or North Yemen) - Yemen Airways (Sana) - and SAUDIA - Saudi Arabian Airlines (Jeddah International) with an overall market capitalization of USD30 million (USD116 million in 2015 Dollars). With the project finalized in 1978, Saudi Arabia then agreed to increase Yemenia's capital through a USD10 million (USD28.5 million in 2015 Dollars) injection in 1980.
However, earlier this month, unnamed airline sources told various Yemeni media outlets that Riyadh had demanded payment of its share of the carrier's profits which would amount to USD800 million. According to the reports, the Saudis have based their claims on their never having gained any returns from their initial investments.
Speaking to the National Yemen newspaper, Al-Mekhlafi said that neither the government nor the carrier had received any official or unofficial notification from the Saudis concerning the matter and that even if they had, their claims would be baseless given that the carrier has not been profitable for some time.
If true, the move would likely be in retaliation for the country's recent signing of a Bilateral Air Services Agreement with Iran enabling Yemenia and Mahan Air (W5, Tehran Mehrabad) to begin 14x weekly flights between the two countries. As part of the deal Iran will also refurbish Yemen's airports while providing Yemenia pilots and technicians with training and technical support.
Sunni-dominated Saudi Arabia perceives Shia-lead Iran's increasingly strong ties with Iraq, Lebanon, Syria, and now Yemen as a threat to the balance of power in the region.
Since September of last year, Yemen has seen the Shi’ite-lead Houthi movement emerge as the de facto ruling power in the country.
