Samruk-Kazyna to sell Qazaq Air for $4 million by the end of September

The General News department correspondent
Business news correspondent
The deal is expected to be closed by the end of September / Collage by, photo editor: Denis Andreev

According to Marat Karabayev, Kazakhstan’s minister of transportation, the Vietnamese Sovico Group is buying Qazaq Air for $4.17 million.

«We expect the deal to be closed by the end of September. There are several conditions under the contract. First, the company’s debt of $79.1 million must be paid off within a certain period. Second, the investor is obliged to register at least 20 aircraft to serve routes both within the country and abroad,» the minister said.

He also pointed out that the investor plans to acquire not 20 but 50 Boeing and Airbus aircraft. Currently, the airline operates just five turboprop De Havilland planes. Earlier this year, authorities indicated that direct investments would exceed $1 billion, turning Qazaq Air into a highly competitive and attractive company. As he noted, Air Astana and Scat currently have fleets of 54 and 50 aircraft, respectively.

«A third airline with the same number of aircraft will emerge in our country. Of course, this will improve competition and make air tickets more affordable,» Karabayev highlighted.

According to the minister, the deal was «very good.» In response to a question about the cost of the deal, Karabayev said that it would be better to ask Samruk-Kazyna, as the fund was directly involved in the negotiations.

«Of course, this deal has a price. As far as I am concerned, it was about $4 million,» Karabayev said.

In late May, President of Kazakhstan Kassym-Jomart Tokayev announced a deal with Vietnamese investors for Qazaq Air at the closing ceremony of the Kazakhstan-Singapore Business Forum.

Samruk-Kazyna has tried to sell the airline for a long time. The first bidding for Qazaq Air was announced in August 2023. In early October, Samruk-Kazyna announced that there were several investors interested in purchasing the company, although the deadline for applications was extended several times. In the end, the bidding was declared failed due to a lack of applications that met all the requirements. In January 2024, the bidding failed for a second time.

In November 2023, Karabayev mentioned that Qazaq Air and the Aktobe airport might be acquired by the Vietnamese Sovico Group. At the time, Karabayev said that the company was evaluated at $16.2 million.

Qazaq Air was established in 2015. According to the last published financial report for 2022, the airline recorded $10.7 million in losses, a 2.1% increase over 2021. Moreover, the company has a $61.7 million debt to the state-owned holding due in 2033.

In Vietnam, Sovico Group runs Vietjet Air. This airline has managed to capture the largest market share in the country over the past five years and is continuing to expand its international network. Along with the air travel business, Sovico Group invests in the banking, real estate, energy and hotel industries.

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