Following the publication of its first profit in 15 years, is SriLankan Airlines being ambitious in potential privatization with Middle Eastern carriers?
The carrier recorded a $5.1m profit in FY22, and is a major improvement from the $25m loss that they made in the financial year prior to that.
Without further ado, let’s get into it…
Which Middle Eastern Carriers Could Acquire SriLankan?
As per Simple Flying, SriLankan Airlines is considering the possibility of being acquired by Middle Eastern carriers.
The carrier’s CEO Richard Nuttall said the following on this:
“If you work with us then you start being relevant to the Indian market in all directions. So, I think that’s the big interest for the Gulf carriers.”
Relationships with the Middle East have been present in the past, with Emirates owning a 40% share of the airline before the government purchased it back in 2008.
Is This Too Ambitious For The Carrier?
With the carrier posting its first operating profit in 15 years, could the discussion of Middle Eastern acquisition with SriLankan be a little premature, and therefore too ambitious at this stage?
Carriers in the Middle East who would want to potentially purchase a stake, or the overall carrier, would need to see a robust model going into the years ahead before doing something like that.
As Nuttall said, he believes the attractiveness of the airline is not down to the financials so much, but about its close proximity to the Indian market.
Air travel in India is growing at a strong rate, and such tourism into the ballpark of SriLankan could add value onto that moving forward.
The future of SriLankan Airlines is beginning to look a lot brighter, and turning over its first operating profit in 15 years is the proof in the pudding for that.
Tourism is beginning to open up in the country once again, and previous acquisitions by Middle East carriers comes as no surprise in terms of the target buyer that the government wants to go to.
Looking ahead, it will be interesting to see where this is going to lead, and whether Middle Eastern influence could propel the airline to where it needs to be in the coming years ahead.
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