Airport appoints Austrian CEO

Malta International Airport has appointed Austrian Peter Bolech, a member of the management team at Vienna International Airport, as its chief executive officer.

Mr Bolech was yesterday described as one of the Vienna airport's best managers, "with an excellent reputation with airlines".

His appointment was announced yesterday during the signing of the agreement to sell a 40 per cent stake in MIA to the consortium Malta Mediterranean Link .

The agreement, which became effective immediately after the signing, involved the payment of Lm20 million to the government for the purchase of equity with a further Lm20 million paid in the form of dividends and taxes on effecting the signing.

Additional revenue under the deal will include the annual lease payment, licence fees and corporate taxes. The agreement is for 65 years.

Malta Mediterranean Link is made up of Vienna International Airport-Flughaven Wien AG (VIE) who own 57.1 per cent, of the shares, the Canadian firm SNC-Lavalin with 38.75 per cent with the remaining shareholding held by Airports Investments Ltd, an associate company of the Bianchi Group.

The government still owns 60 per cent of the shareholding but plans to sell another 20 per cent through a public offer by the end of October.

The deed was signed at the Westin Dragonara by Finance Minister John Dalli and Joseph Scicluna, permanent secretary at the Ministry of Finance, and by Kurt Waniek from Vienna International Airport, Louis St Maurice from SNC-Lavalin and Ralph Bianchi from the Bianchi Group on behalf of the consortium.

The consortium believe that MIA possesses a substantial growth potential primarily because of its geographical position.

"MIA, which currently generates an annual turnover of about Lm16 million and handles about three million passengers annually, will be turned into a Mediterranean hub modelled on Vienna Airport's success story."

"The expansion of commercial activities, retail business, cargo, congress and conference travel as well as short holiday breaks offer promising opportunities for growth", the consortium said in a statement.

Answering questions by reporters, Dr Waniek said that the consortium will bring to Malta the experience and expertise that VIE has built over the years in building an aviation hub in Vienna.

"We are proud of what we have achieved in Vienna and we will bring over to Malta that sense of pride to the people of Malta and the employees at the MIA," Dr Waniek said.

He said that a lot of hard work and marketing had gone into turning Vienna airport into a major hub and the same would be done in Malta.

He said it was too early to divulge details about the business plan, which has already been put together and which they would be working on straight away.

Asked how Air Malta, the national carrier, will fit in after the sale of these shares, Mr Dalli said the part privatisation did not mean that a new company had been formed but that new shareholders had come into the company.

"Air Malta will maintain the same relationship it has had so far with the MIA," Mr Dalli said.

On this point, Dr Waniek said that one of the main tasks of the consortium was to maintain good relations with all the players that make use of the MIA and to build further on those good relations.

As part of the agreement with the government, VIE and SNC-Lavalin will have technical service agreements with MIA to provide support for strategic development, and for the expansion of retail operations, airport and aviation marketing, personnel development, the "cruise and fly" sector and the cargo division.

The cruise and fly expertise would be important to Malta when one takes into account the planned building of the sea passenger terminal at Pinto Wharf catering for cruise and fly passengers.

SNC-Lavalin Group is one of the largest engineering and construction group of companies worldwide.

The group employs about 15,000 people in offices across Canada and in 30 other countries. It is currently working in about 100 countries.

SNC-Lavalin has 40 years experience in international project management and financing with 25 of those years in the airport business. Last year, the group registered a turnover of Lm666.7 million.

VIE will come to Malta with an impressive track record. Over the last 20 years their business volume has quadrupled, shooting up to 12 million passengers.

Their experience in the development of hubs is outstanding - since 1990, their share of transfer passengers has increased from 14.6 per cent to nearly 32 per cent.

They have carried out intensive marketing operations to enhance their hub reputation in view of the forthcoming accession into the EU of Eastern European states including the Czech Republic, Slovakia, Hungary, Croatia and Slovenia.

The Bianchi Group will bring knowledge of the domestic market, particularly of the tourism industry.

Introducing the MIA CEO to the media, Herbert Kaufmann, a member of the management team at VIE, described Mr Bolech as "one of our best managers who has an excellent reputation with airlines".

The Labour spokesman for the economy Leo Brincat said in a statement yesterday that he could not comment on the agreement as he had not yet received a copy of it, either as Opposition spokesman, or as chairman of the parliamentary public accounts committee.

He said he awaited reassurances on the status, working conditions and employment of MIA staff, as well as whether the tariffs imposed by MIA would change.

He queried whether the MIA operations would still complement the national airline's core business.

"It is clear that the government will lose effective control of MIA once it sells a further 20 per cent of its shares to the public in October," he said.

"What is still a mystery is the effective price that MIA will pay for the technical service agreements with the consortium's strategic partners, in sectors ranging from personnel management to marketing, from the cargo sector to strategic development. We will only be able to say whether the agreement was a fair deal or not once these things are known," he said.

Mr Brincat said he was ready to call a meeting of the PAC during the summer holidays to discuss the agreement, as this would otherwise only happen after the recess.