Adria Airways’ receiver, Janez Pustatičnik, has announced that the bankrupt carrier’s Air Operator Certificate (AOC), as well as other licenses and permits, will be sold off at an auction which will likely take place in mid-January. An AOC allows its holder to perform commercial flights and is issued by the country’s aviation regulator. A Slovenian AOC would give its holder rights to maintain services from Slovenia and other European Union-member states. Although Adria’s AOC will expire at the end of the year, the Slovenian Civil Aviation Agency has expressed its readiness for the certificate’s validity to be extended. The process for obtaining an AOC in Europe differs from country to country.
Mr Pustatičnik previously received five non-binding bids for various parts of Adria’s business, including its permits and licenses. One entity offered 45.000 euros for Adria’s AOC, manuals and other documents. As a result, the starting price for the AOC has been set at 45.000 euros. The Slovenian Civil Aviation Agency noted that Adria’s AOC would be of use only to an entity buying the former flag carrier’s entire estate. The party that acquires the license will also have to take on a number of obligations. Among them is the amendment of any discrepancies that arose following the revocation of Adria’s AOC and the launch of bankruptcy procedures.
It is believed Joc Pečečnik, the founder of Interblock Gaming, which manufactures products for lottery games, submitted a non-binding bid for the entire estate of the bankrupt airline in cooperation with a partner from abroad. According to reports, Mr Pečenik's plan is to establish a new Adria with the help of the carrier's former CEO Mark Anžur. Mr Anžur ran the company from late 2012 until its privatisation in March 2016. He later went on to serve as the CEO of the Irish regional carrier Stobart Air for an eight-month period. Produce importer and real estate developer Izet Rastoder filed a non-binding bid for Adria’s AOC, however, in a recent interview, he said he might not purchase it after all.
Such a sad end to Adria.
ReplyDelete58 years of service worth 45,000 euros.
Delete:(
DeleteThe company was on the verge of bankruptcy numerous times during those 58 years and bailed out by various companies and governments. It was never a well run business.
DeleteIt will be interesting to see if anyone serious buys the AOC.
ReplyDeleteI wonder what the entire company could fetch at this point. If 4K bought it for peanuts while still operational I wouldn't be surprised if someone takes it for a euro.
ReplyDeleteSeems like it's 45,000
DeleteIf you buy the company, you have to pay the debts as well. If you buy assets after it goes into receivership, you're not taking on the debts. So the entire company is likely worth less than 0.01EUR and nobody would buy it whole, however the sum of the assets individually worth over 0.01EUR each is naturally greater - the important thing is that the debts outweigh other assets.
DeleteCould a new Slovenian airline work as Rastoder plans? Anzur wasn’t a bad CEO. He at least has some background in the industry unlike Adria’s last CEO and owners.
ReplyDeleteRastoder has already established the name Air Adriatic. It is Adria 2.0. Hope it works.
DeleteWow, he registered a company. That takes about 15 minutes if you have 7500 EUR lying around.
DeleteWell he already said, and I quote, Slovenians shouldn't be forced to go to other airports like "cigani".
DeleteTrue businessman.
DeleteIt's a lost cause for whoever is wishing to set up a new airline. It is just too competitive for a newcomer to survive.
Deletehttps://de.wikipedia.org/wiki/Air_Adriatic
DeleteAnzur wasn't a bad CEO ???? With a background in the industry ???? Selling roof bricks before he joined Adria ??? It is obviously you don't know him and what he was doing...
DeleteWouldn’t be surprised if the government bids for it to set up a new state flag carrier. Although PM there are no plans, rumors are Počivalšek hasn’t given up on the idea and is still lobbying.
ReplyDeleteThe government has been quite clear they won't go ahead with a new state-owned airline.
DeleteAccording Rtv Slo on 25th December they said that Pocivalsek still believes no definitive decision has been made about it. Even though the PM says otherwise.
DeleteLuckily there is no that much money to be smoked away because these people have the brain still in the eighties of last century. Well for them in yu and now is the same heaven so.
DeleteDoubt there will be any buyers when auction day comes around.
ReplyDeleteI think so too. If someone was serious, they would have offered more money and they would have sold it to them straight up without any auction.
DeleteIronically, there is more interest for bankrupt Adria then at the time it was fully operational. In 2016 there were 3 bids. In 2019 after bankruptcy 5 non binding bids.
Delete^Makes sense. Adria cost some money. This is peanuts for any serious company
DeleteIt is most likely that some Russian airline or someone like that buys the AOC so they can fly within the EU.
ReplyDeleteA non-EU company can own only 49% of the AOC holder, to make it usable in EU.
DeleteIf I remember correctly the former Chinese VLM owners first acquired Slovenian AOC because it was easier to get and only later for the Belgian one. Obviously isn’t such a big process in Slovenia like in some other countries.
DeleteThey'll find some Russian who has Cypriot passport to make it look nice.
DeleteHaha my thoughts too. Like the Chinese at VLM who got a golden EU passport because they invested money in some country.
DeleteSolinair is an example of completely Turkish-owned company, which can fly in Europe because the legal owner has EU passport.
DeleteGood luck.
ReplyDeleteI hope they sell it for big money because it is through this that they have to pay late wages to former staff.
ReplyDeleteYou keep hoping, but the reality is Adria's assets at the time of bankruptcy were essentially 0. AOC is not worth more than at best 300-400k.
DeleteActually, wages to former staff will all be paid out by the end of this month. The money will now be used to pay Adria’s debt.
DeleteBasically, to pay for the mess the Germans left.
DeleteWell it seems you can literally buy the AOC :)
DeleteActually, wages to former staff will all be paid out by the end of this month?
DeleteHow did you come to this conclusion?
It was announced by bankruptcy administrator.
DeleteCan you provide a link? As total amount to be payed to former staff is 14 mil. 8 mil is settlement cost. So that leaves 6 mil in unpaid wages.
DeleteBetter than the government setting up a state run airline.
ReplyDeleteWhat actually is the content of AOC? I may travel a lot but have never thought of the administration issues... is this JP/ADR and flying rights or something completely different?
ReplyDeleteYes flying rights. But since Adria's AOC was revoked it means the new owner will have to fix up the reasons for which it was revoked in order to use the AOC.
DeleteAOC contains more or less of just manuals and other paperwork required for operating commercial flights. On top of that you need operating licence, which is tied to management structure and proper funding (to ensure safety, maintenance standards, etc.).
DeleteIs the AOC still valid? I mean the airline has been out of business for three months.
ReplyDeleteAs you can see in the article it is still valid and its validity will be extended.
DeleteSo the Adria name may live after all :)
DeleteCould a new airline be set up under the same name?
DeleteWhat does AOC has to do with name of the airline?
DeleteAeroflot should buy it and evth will be OK. Adria's prices for tickets were incredible high and not to understand. All the employees of the Slovenian companies in Moscow did search for tickets with other companies and stop over in other countries instead of flying directly to Ljubljana with national company and the Adria planes were half empty. Hope anyway that Adria will stay alive and fly again.
DeleteAnd what is happening with 4K Invest? Has anyone been arrested?
ReplyDeleteLOL
DeleteNo, they are closing their companies left and right to avoid being prosecuted.
Deletehttps://www.exyuaviation.com/2019/12/4k-companies-collapse-following-adria.html
DeleteIt would be great news for Ljubljana Airport if someone buys the AOC and launches flights.
ReplyDeleteJust because they get an AOC does not mean they will launch flights.
DeleteOh and it also doesn’t mean that they will launch flights out of Ljubljana. With a Slovenian AOC they can fly from Spain to Italy or anywhere within the EU.
DeleteThis process has been really dragging on. Why is the bankruptcy administrator launcing an auction? Why not just sell it to Rastoder.
ReplyDeleteTo raise more money, obviously.
DeleteHow long do these bankruptcies proceeding usually take place?
ReplyDeleteIt can be years but I doubt that will be the case here.
DeleteHas Air Berlin’s bankruptcy been closed?
DeleteNope. It is still going, and Air Berlin’s bankruptcy manager is now suing Etihad for 2 billion euros.
DeleteAir Berlin shouldn’t be a common example of airline bankruptcy proceedings because it has actually been an extremely complicated process and unlike many others because of all the players involved.
DeleteOuch
DeleteHow many commercial airlines are registered in Slovenia? Anyone know?
ReplyDeleteAero4m and Lipican Aer, as well as Solinair which is cargo. I think that's it.
DeleteAnd none of them wanted to start scheduled flights to replace Adria?
DeleteObviously not.
DeleteThey are run as profitable businesses and it would be extremely difficult to run a profitable airline flying from LJU unless it can feed to long-haul or is an LCC.
DeleteThe AOC is the most valuable thing left from Adria.
ReplyDeleteLess talk more action. Everyone is proposing something - state, businessmen, subsidies but no one has taken any concrete action yet.
ReplyDeleteActually it's impressive at what speed Slovenia has had gotten this process underway.
DeleteWell things are slowly moving on and Adria will in a year or two be completely forgotten. But what I don’t understand in all of this is that 4K has no accountability in anything. It’s like the government is letting them get away with everything on purpose. They haven’t even made charges against them.
ReplyDeleteLast time I checked the government isn’t the one that investigates wrongdoing in privately owned companies.
DeleteYeah, the government is just responsible for stirring up shi*t, not cleaning up the mess. Is shows quite clearly.
DeleteDo they have any slots on sale, in particular at any congested airport?
ReplyDeleteFrom what I heard there were attempts to keep Amsterdam slots. Don’t know what was the outcome.
DeleteSlots for most airport can't be sold if the holder has gone bankrupt.
DeleteHope it works out for some of them.
ReplyDeleteWould be hilarious if one of the bidders was 4K Invest.
ReplyDeleteI wouldn't be surprised.
DeleteBe careful what you wish for.
DeleteIt's so sad it has come to this :(
ReplyDeleteJP was on the verge of bankruptcy throughout its history. It hardly comes as a surprise.
DeleteAdria just won't die.
ReplyDeleteWhere were all these investors 3 years ago when Adria was being sold?
ReplyDeleteThey were smart and not wasting their money on a lost cause.
Delete+1 last anon
DeleteIf ot os bought by one of these guys hoping to set up a new airline, it will another overly ambitious project that is bound to fail.
ReplyDelete*it is
DeleteIf some of these want to set up a private airline I'm fine with that. But please no more state run airlines. Thank you.
ReplyDeleteThere won't be a state run airline.
DeleteWaiting to hear the conspiricy how Lufthansa will be behind some mystery buyer :D
ReplyDeleteFrankly, there is nothing to buy. AOC is linked to the management system which is based on five key fuctions; Accountable manager and four Nominated persons. Those are all gone. AOC is linked to Operating License which is revoked due to financial reasions. The name of Adria Ariways is linked to a registered name in the chamber of comerce, and company is under liquidation. Anyone buying JP paperwork would only enter troubles instead of benefits. btw, according to EU 965 and 1008, JP should be long time go. CAA is keeping it only due to political burden.
ReplyDeleteI've never understood the CAA's actions when it comes to Adria. Very irrational.
DeleteWell most if tbe people running the CAA used to work at Adria.
DeleteCAA doing their absolute best to keep Slovenia at the level of 3rd world countries when it comes to ICAO ratings.
DeleteIs the date of tbe auction known?
ReplyDelete**the
DeleteMiddle of January
DeleteIf someone does set up a new airline, I hope it is an LCC.
ReplyDeleteMarket is too small to sustain local LCC.
DeleteWhen this process is completed, it will truly be the end for Adria.
ReplyDeleteGood riddance.
DeleteWhat about the flight school. Is it included in the package?
ReplyDeleteThat would make no sense.
DeleteIt's not 1960s anymore. There's no need for airlines to have their own flight schools.
Deleteflight school was a separate legal entitiy. now it is also in bankruptcy proceedings.
DeleteI do not understand the concept of selling a AOC. Should not a new airline apply for one in the country they plan on starting flights from? Should it not be based on the qualifications and readiness presented to the government authority of the host country?
ReplyDeletePerhaps someone can explain.
Thanks.
Any EU AOC holder (airline) can operate any flight within EU. You can fly MUC-FRA with Slovenian AOC or ZAG-DBV with a Romanian AOC.
DeleteThe JP hangover will soon be over. By 2021, LJU will have its own new modern terminal. More frequencies and new airlines because Fraport is here to stay.
ReplyDeleteLH will likely increase FRA and MUC to at least 4 daily similar to many Eastern European or Balkan capitals and cities.
Wow, are you sure about 4 daily flights? What in the world has a new pax terminal have to do with increased passenger numbers? Are people going to travel to Slovenia just to see the new terminal :D.
DeleteGet real, there will be no quad daily flights to anywhere. You had Adria, now you have next to nothing.
Before, state will pay Lufthansa a lot to increase frequencies with your taxpayer money ;)
DeleteEverytime an airline goes bust, funny discussions pop up about "buying" or "selling" its AOC. You cannot buy an AOC. You can buy the entity which holds the AOC (note: I said "holds", not "owns" -- the AOC is not a physical asset that you could separate out). And in order to hold the AOC, the entity needs to have postholders on payroll, at least one aircraft leased or owned (the AOC is type-specific), and much, much more. Does Adria still have postholders and is paying them remuneration? Does Adria still have any aircraft, leased or owned? I am not familiar with the licensing rules of the Slovene CAA but can't imagine they would be so different from the rest of the EU.
ReplyDeleteIn addition, if you do decide to buy an entity that holds an AOC (i.e. buy the shares that make up its equity), you are also assuming all of that entity's liabilities, debts and obligations, unless the creditors and authorities have waived/released/forgiven them (is this the case of Adria's debtors??). The size of Adria's liabilities will definitely be a multiple of what it costs to set up a new AOC, needles to mention the skeletons in the closet that you avoid with a new AOC.
To restart Adria is not a big deal.
ReplyDeleteIt will operate SSJ only as Azimut do.