LAWMAKERS yesterday gave the thumbs-up to Cyprus Airways’ (CY) choice of consultants charged with drafting a restructuring plan whose objective is to turn the ailing company into a competitive carrier.
A viable plan was a condition set by parliament before it releases the second tranche of a €31 million share capital increase and would have to be approved by lawmakers before it can be implemented.
With the approval of the House Finance Committee, the airline can go ahead and award the contract to AirFrance-KLM Consulting.
The company was selected from a list of six that included Lufthansa Consulting, KPMG, ICF SH&E, Feuerherd Aviation and Lowdexx Aviation.
The consultants’ brief includes reviews of CY’s management structure, its business model, and determination of personnel requirements and remuneration levels.
The plan must also make the airline attractive to any strategic investor wishing to acquire a majority stake in CY.
The national carrier posted a €32.1 million loss in the first half of the year as passenger and cargo revenues dwindled.
Deputy chairman of the House Finance Committee Angelos Votsis (DIKO) said legislators hope the restructuring plan will be delivered by October 29.
In response to reporters’ questions, he said the main criterion for selection was not the lowest bid, but rather the contractor’s expertise and know-how.
Air France-KLM submitted the fourth lowest bid at €226,175 plus expenses. Under the tender the expenses must not exceed 15 per cent of the initial quoted price.
It’s possible that in the meantime the airline, in consultation with the Finance Ministry, may go ahead with some redundancies even before the rescue plan is implemented, Votsis said.
The brief does not include supervising the actual implementation of the plan; for that, CY will be inviting a new round of tenders.
Commenting on this, Greens MP George Perdikis said the contract should have included the implementation part: “Rescue plans are a dime a dozen. Many have been drafted, many have been implemented, but unfortunately they were implemented wrongly, and here are the results.
“Had earlier plans been implemented correctly, today Cyprus Airways would not have a large number of excess personnel. Previous plans should have removed all the fat from Cyprus Airways,” he remarked.