Ethiopian Airlines, ComAir among 11 firms expressing interest in Air Malawi

Malawi’s Privatisation Commission says it has received expressions of interest from 11 local and foreign companies vying to take over the country’s national airline, Air Malawi.

The commission invited expressions of interest in September.

The commission’s CEO, Jimmy Lipunga, says the companies that have shown interest in taking over Air Malawi include South Africa’s Comair and Fly Africa, Botswana’s Global Business Network, Ethiopian Airlines and local firms African Star Airways, Air Express, Alpha & Omega Duty Free Shops, CDH Limited, Global Airlines, Jetlink Airways and Mpatsa Holdings.

“The commission, with the assistance of the transaction adviser, Ernst & Young, and key stakeholders in government, has commenced the process of evaluating the expressions of interest received, which will culminate in the selection of the preferred bidder,” says Lipunga.

The shortlisted firms will be required to obtain an information memorandum from the commission and to sign a confidentiality undertaking to participate in the formal bidding, which closes on December 15.

Lipunga says the selection criteria will place strong emphasis on the financial and technical capabilities of the bidders to recapitalise Air Malawi.

“International operators will, during the bid-ding process, be encouraged to form consortia with local investors from [those] on the list or those not on the list,” he says.

The Malawi government is privatising Air Malawi to improve the airline’s financial, tech- nical and operative capability to foster competition in the country’s aviation sector.

This is the third time Malawi has advertised for a strategic equity partner in Air Malawi. Government failed to privatise the airline in 2003 and 2008, partly “because it was not attractive to prospective operators due to its huge debts”.

However, Lipunga says the Malawi government, which currently wholly owns the airline, has decided to honour the liabilities of the airline as it pushes to attract a strategic equity partner.

Air Malawi’s routes network includes five regional and three domestic destinations from its twin hubs of Chileka Airport, in Blantyre, and Kamuzu International Airport, in Lilongwe.

On the regional front, it serves the cities of Johannesburg, in South Africa, and Dar es Salaam, in Tanzania.