in Business & Finance

Government of Burundi plans merger of Air Burundi and SOBUGEA

Posted 7 August 2017 · Add Comment

The government of Burundi is planning to resuscitate moribund national carrier Air Burundi by merging it with fellow parastatal, the profitable ground-handling firm SOBUGEA (Société Burundaise de Gestion des Entrepôts et d'Assistance des Avions en Escale), reports ch-aviation.

The move has encountered intense resistance from SOBUGEA's labour unions who fear mass retrenchments, and even the firm's possible bankruptcy, should the merger proceed.

Air Burundi has been teetering on the brink of collapse since 2007 owing to a lack of serviceable aircraft. The carrier added a single MA-60 over four years ago but has yet to deploy it into revenue service.

As such, to rectify the situation, Burundi's vice-president brought together the Ministry of Transport, Public Works, and Machinery as well as the director general of Air Burundi to devise a way forward concerning the revitalisation of Air Burundi. A multisectoral commission was then established consisting of thirteen experts from across the country's economic divide.

According to the committee's note of June 14, the government is interested in merging the two entities. "The merger of the two companies would thus make it possible to generate significant savings resulting from the economies of scale given the similar activities and related investments they are involved in."

The first secretary of SOBUGEA's labour union, Hamissi Hakizimana, has said that before any merger can proceed, a full due diligence of either firm must be undertaken with its results submitted to shareholders for their final decision. He highlighted the fact that in the case of SOBUGEA, government is a 90% shareholder with the remaining 10% held by private entities such as local insurance firm SOCABU and even Belgian carrier Brussels Airlines. It, therefore, cannot act unilaterally without the consent of other shareholders, he said.

* required field

Post a comment

Other Stories
Advertisement
Latest News

Embraer’s Praetor 600 business jet makes Its first transatlantic crossing

Embraer’s new Praetor 600 super-midsize business jet has completed its first transatlantic crossing, powered by Sustainable Alternative Jet Fuel (SAJF).

Comlux delivers first VIP Wide body cabin completion on Airbus ACJ330

Comlux has announced the delivery of its first VIP Wide body cabin completion on an Airbus ACJ330.

Ethiopian makes travel easier with upgraded mobile app

Ethiopian Airlines has launched its Ethiopian Mobile Application - customised with a suite of innovative features including document scanning, and mobile wallet for boarding pass.

Have an ice day...

An African company has targeted Antarctica as a tourist destination. Dave Calderwood reports.

Rolls-Royce delivers first Pearl 15 production engines

Rolls-Royce announced that the first sets of Pearl 15 production standard engines were delivered to Bombardier and have been fitted to the first Global 6500 aircraft that is now in completions in readiness to power its latest business

Gulfstream G600 nears end of function and reliability testing

Gulfstream Aerospace has said its all-new, award-winning Gulfstream G600 is nearing the end of function and reliability (F&R) testing, the final stage of flying required for aircraft type certification by the U.S. Federal Aviation

EBACE SK1704230519
See us at