The Sri Lankan government is in talks with many private companies and airlines as it prepares to privatise SriLankan Airlines (UL, Colombo International), including Emirates (EK, Dubai International) and the Indian conglomerates Tata Sons and Adani Group, according to Veeraperumal Ravindran, the carrier’s regional manager for India, Bangladesh, and Nepal.
Ravindran was speaking to the Indian broadsheet The New Indian Express to raise the airline’s profile in the Indian state of Kerala, where it is planning to increase its frequencies between Colombo and Thiruvananthapuram in the coming winter schedules from 6x to 7x weekly and to maintain its 10x weekly frequencies to Kochi International. It also plans to start flights to Kozhikode given the availability of aircraft.
There has been a steep rise in traffic from India to Sri Lanka in the last seven months, he said, adding that business at the airline is picking up as “things are becoming more normal in Sri Lanka”. However, he said nothing more about the privatisation.
As ch-aviation has previously reported, Tata Sons, the owner of Air India, Air India Express, Vistara, and AirAsia India, has long been considered a possible investor in Sri Lanka’s state-owned carrier.
But it is the first time Adani has been mentioned. Group chairman Gautam Adani met Sri Lankan President Ranil Wickremesinghe in July during a two-day visit of the president to India. They were reported to have discussed multiple projects in the island nation, chief among them the development of the Colombo Port West Container Terminal, but the airline was not mentioned.
Emirates, meanwhile, bought a 43.63% stake in SriLankan in 1998 together with a ten-year management concession, but following a falling out between Emirates-installed executives and the government of then-president Mahinda Rajapaksa, it opted not to renew its contract in 2008. It divested its shares to Colombo in 2010, since which efforts at finding a strategic investor for the airline have failed.
Wickremesinghe, then prime minister, pledged in May 2022 to privatise loss-making SriLankan Airlines as a means of offloading the costs of restructuring the carrier to private investors rather than using the state’s almost empty coffers. As CEO Richard Nuttall told ch-aviation in June, the aim first is to restructure the carrier’s balance sheet given the high cost of servicing its legacy debt and only then to sell it. In early July, Sri Lanka’s civil aviation minister, Nimal Siripala, said the restructuring of SriLankan Airlines must be completed within six months.
