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Investors as far as Africa have shown interest in LIAT –- PM Browne

Prime Minister Gaston Browne says while the situation with the cash-strapped LIAT remains “tenuous” it could resume flights to some destinations even as the administrator continues his work as part of the reorganisation of the airline.

Gaston Browne says the cash-strapped LIAT has received interest from as far as Africa.
(Photo: NOW Grenada)

Browne, who has been against any plans to liquidate LIAT (1974) Limited, said interests are being shown in the airline by investors, some as far away as Africa.

“There is one entity that has offered I believe US$25 million investment for 51 per cent of the shares. There is another airline, a regional airline that offered to invest about US$25 million…for about 60 per cent of the shares in LIAT and there are at least three governments who have shown some interest in investing in LIAT.

“So there are some prospects that the administrator is pursuing and we believe that ultimately on the basis that the administrator is successful in getting the cooperation of creditors LIAT will be reorganised and be back in the air and take its pole position,” Browne said.

St Vincent and the Grenadines and Barbados will turn over their LIAT shares to Antigua and Barbuda for one EC dollar each.

Last month, Browne told the Caribbean Media Corporation (CMC) that a decision had been taken that would allow St Vincent and the Grenadines and Barbados to turn over their shares in LIAT to Antigua and Barbuda for one EC dollar (One EC dollar=US$0.37 cents) each.

The other shareholder- Dominica- has said it supports the efforts to re-organise LIAT, even as it provides licences to other carriers to serve the island.

According to the new reorganisational plan, a copy of which has been obtained by the CMC, Antigua and Barbuda is proposing re-investment of EC$108 million with St John’s indicating that under the new plan it is prepared to underwrite up to 50 per cent of the required capitalisation.

Dominica, the other shareholder, says it supports LIAT’s reorganisation plans but has begun granting licences to other operators to ply the island.

“The new capital invested during reorganisation will be protected, in that it will rank in priority above all other creditors in the unlikely event of liquidation,” it said, noting that the remaining EC$54 million to be shared by other private and public sector entities, including existing shareholder governments.

Browne said investors from as far as Africa have expressed an interest in the reorganised LIAT.

“One of the entities that approached us as well to invest in LIAT is an entity out of Africa that has an airline and they want to offer trans-Atlantic links between Antigua and West Africa.

Prime Minister of Antigua and Barbuda Gaston Browne (File photo)

“So the issue is whether or not we go as far as selling outside of the Caribbean. Again that may be a difficult proposition in the sense that it is a Caribbean airline (and) we would rather prefer having the ownership Caribbean, but again if the other deals fall through and we have to look at extra-regional ownership, then certainly we will have to do that.

“But the whole objective here is to get LIAT back up and running,” he said, noting that while the airline is now “on life support” St John’s does not regard allowing it to “die” as an option.

“Whereas LIAT is on life support as far as we are concerned…what is required is reorganisation and to bring LIAT back to good health and so far some progress has been made, but the situation remains somewhat tenuous (and) again all depends on the negotiations, how successful the negotiations with our creditors go and that will determine whether or not we will be able to reorganise it,” Browne said.