After Cyprus Airways bankruptcy, a new airline for Cyprus: Cobalt

[sn26567]

Cyprus Airways must receive financial aid or it will be forced to shut down operations.

The Cyprus government is talking about three scenarios for the financially troubled carrier:
- Shut down the company immediately,
- continue operations during the summer season, or
- continue operations further.

The last scenario would include 560 job cuts, payment cuts and fleet reduction from 11 Airbus A319/320s to six aircraft, plus a reserve. The company also would need financial aid of €83.2 million over the next three years.

The European Commission has barred the Cypriot government from providing any further public support to the airline without prior approval.

Full story from ATW online

[sn26567]

The government has decided to bail out Cyprus Airways at least until the end of the summer. The tourist season is safe.

I'm afraid that the European Commission will not be so happy...

[sn26567]

Rescue plan for Cyprus Airways faces setback

Cyprus Airways’ staff have rejected a rescue plan from the island’s government, putting its future in more doubt.

Plans drawn up by Air France Consulting include slashing the 1,000 staff down to 350, cutting salaries by 17 per cent and reducing the fleet from 10 aircraft to six.

Recent talks with a Beijing-based investment company over a potential cash injection for the carrier are thought to have been inconclusive.

One potential option to help the airline would be the sale of its highly valuable slots at Heathrow, from where it operates twice daily with a fair degree of business traffic.

[quixoticguide]

A source at Middle East Airlines Friday confirmed reports it was negotiating with Cyprus Airways to acquire the company's assets and said the results of these talks would appear by the end of May.

Read more: http://www.dailystar.com.lb/Business/Le ... z2R01b0VPp

[sn26567]

Another source mentioned that the Cyprus government (majority shareholder) was negotiating with a Chinese company.

[sn26567]

MEA allegedly in hush-hush talks with Nicosia over Cyprus Airways buy out

MEA - Middle East Airlines has thrown its hat into the proverbial ring with Lebanese reports now claiming the carrier is in talks to acquire ailing Cyprus Airways. According to a report in the Lebanese paper, The Daily Star, highly confidential talks are ongoing though no mention is made as to whether the Beirut-based airline "would seek to buy part or all of the Cypriot national carrier". The report goes on to speculate that MEA "could benefit from Cyprus Airways’ low cost of operation and expand the network of its flights abroad”. Negotiations are set to reach a decision "by the end of May."

Source: ch-aviation

[BrightCedars]

It would be a sound move by MEA as it would provide a protected nearby airport facility to allow for the conduct of operations in case BEY is rendered unavailable for a reason or another. Also, CY has been providing competition to MEA so controlling it can't be bad in that perspective. Quid of CY's nationality, although that shouldn't be much of a concern as Lebanon and the EU enjoy open skies. Not sure Lebanon's Southern neighbour would like to see this happen though.

[b720]

I think that MEA can turnaround Cyprus Airways, provided they achieve the backing of the Cypriot government to
restructure the airline (beyond recognition). My bet is that they will transform it into a sort of lean and efficient LCC that can serve the interest of The Cypriot tourism sector, and might help fend off competition from the numerous gulf and european LCC. MEA has been, for the past year, seriously considering setting an LCC arm. The New Cyprus Airways might be a golden opportunity. They might even allow them to operate from BEY on behalf of MEA on some M.EAST routes competing head on with the likes of JAZEERA, AIR ARABIA< and FLY DUBAI. On the other hand, MEA can also lease 1 or even 2 330-200s to the new Cyprus Airways and launch full service direct flights from Larnaca to JFK and YUL.

[sn26567]

The MEA deal has collapsed. What now? Counting on themselves...

Cyprus Airways unions agree to tough cuts

Cyprus Airways (CY) and its trade unions, PEO and SEK, have reached a compromise which will see half the loss-making carrier's workforce laid off in order to save the airline from closing outright. As part of the government-backed cost cutting drive, 490 staff are to be made redundant, wage cuts will be enforced, and the airline's fleet will be reduced to six aircraft.

The deal was struck following reports that negotiations with Lebanon's MEA - Middle East Airlines (ME) had collapsed under unclear circumstances. According to Lebanon's Daily Star, part of the blame for the deal's fall-through was attributed to Lebanese Central Bank Governor Riad Salameh, who refused to commit Central Bank funding to MEA's proposed total buyout of Cyprus Airways, claiming it would have "presented too many risks to the country's already fragile monetary and economic climate."

Source: ch-aviation

In Belgium, owing to the Sabena experience, unions would have let the company go bankrupt...

But where is Cyprus Airways going to fly with only six aircraft left in their fleet? I hope Brussels will be kept: when I flew with them last year the load factors were quite high.

[sn26567]

Struggling Cyprus Airways cuts Greek routes, sells off two jets

Cyprus Airways (CY, Larnaca) is teetering on the brink of collapse following reports that two more aircraft, an A319-100 and an A320-200, have been put up for sale as Nicosia desperately tries to find a solution to the airline's crisis.

As part of a raft of painful cost-cutting measures, the decision has been made to leave the Greek domestic market entirely with effect from July 1 while at the same time, 490 out of 1'040 staff will be laid off to help reduce wage overheads.

It is also reported that the government has already set up another company which will take over the airline's operations at some point, though this has yet to be corroborated.

With repeated attempts at finding buyers willing to invest in the struggling airline failing, Nicosia was forced to inject EUR 100 million of its own money at the beginning of the year. The move has now resulted in an inquest by the European Commission to see whether or not the funds contravened EU regulations regarding state aid.

Source: ch-aviation

[herethereanywhere]

Cyrpus Airways made a huge mistake when it started serving domestic routes within Greece.In my opinion this was the beginning of the end . In a market that was already dominated by Aegean (A3) and Olympic (OA), there was no room for a third "player". The only carrier that will eventually survive in the Greek civil aviation market will be A3.I think that CY will shut down operations sooner or later.

[sn26567]

Cyprus Airways outlines plans for new carrier based on Cyprair Tours

Cyprus Airways has put together a contingency plan to be executed in the event the European Commission rejects a proposed turnaround plan for the struggling airline. Under the plan, unveiled at a news conference in Nicosia by Cyprus Airways board chairman, Tony Antoniou, the carrier's wholly-owned tour operating subsidiary, Cyprair Tours, would apply for an air operator certificate. Once granted, Cyprair Tours would inherit Cyprus Airways' traffic rights with all staff at Cyprus Airways to be laid off and then rehired at the new Cyprair Tours. The airline would then be built from the ground up, Mr Antoniou said.

According to the Cyprus Mail, the plan is still in its early stages with foreign consultants having been hired. Cyprus Airways' EUR54million restructuring plan was submitted to Brussels earlier this year and includes provision for the downsizing of both staff and the fleet with only six A320-200s to be retained for operations.

Mr Antoniou also disclosed that the hunt for a strategic partner for the State, which owns a 70% stake in Cyprus Airways, is progressing well with various undisclosed foreign airlines and investors having shown a “serious interest”.

Source: ch-aviation

[airazurxtror]

Cyprus Airways may have to pay back more than 101.3 million euros in government aid that was administered in 2012 and 2013, according to Phileleftheros.
If this occurs, Cyprus Airlines would become bankrupt, as it is already faced with mounting financial challenges.
The EC's conclusion will impact the nation's negotiations with nine parties, who are interested in the debt-ridden airline and have submitted proposals.

http://www.newgreektv.com/index.php/wor ... us-airways

[theeuropean]

The deadline should have been normally today for Cyprus Airways to send the Commission a turnaround plan for survival. The outcome will be tomorrow finally according to Greek Air News:

https://www.facebook.com/GreekAirNews?fref=ts

Today Aegean Airlines announced 2 new routes out of Larnaca. Larnaca - Tel Aviv - daily service and resumption of Larnaca - Kiev - 3x weekly both routes with A320 aircraft.

http://en.aegeanair.com/all-about-us/pr ... /?prid=511

[Magiktrix]

According many sources Cyprus Airways as to cease operations.

[Boeing767copilot]

Cyprus Airways closed down after EU state aid ruling

http://uk.reuters.com/article/2015/01/0 ... MI20150109

[Passenger]

Cyprus Airways closed down after EU state aid ruling

http://uk.reuters.com/article/2015/01/0 ... MI20150109

Today's EU press release:
http://europa.eu/rapid/press-release_IP-15-3121_en.htm

[sn26567]

I had good flights with Cyprus Airways, back in 2012

https://www.aviation24.be/forums/viewtopic.php?f=4&t=48441
https://www.aviation24.be/forums/viewtopic.php?f=4&t=48478

[theeuropean]

Rumor has it that Aegean will make a press conference in Cyprus later today.

[sn26567]

Rumor has it that Aegean will make a press conference in Cyprus later today.

Earlier last week, Aegean had already announced flights from Larnaca to Tel Aviv and Kiev:

https://www.aviation24.be/airlines_press_r ... aviv-kiev/