Kuwait seeks bids for 35% stake in loss-hit flag carrier

State-backed Kuwait Airways Corp hasn’t turned a profit since the 1990 Iraqi invasion
Kuwait seeks bids for 35% stake in loss-hit flag carrier
Kuwaits government is keen to see its flag airline return to profit after more than a decade of losses
By Bloomberg
Mon 01 Aug 2011 07:29 AM

Kuwait is seeking bids to sell 35 percent of Kuwait Airways
Corp. as the OPEC oil producer searches for strategic investors to return the
national flag carrier to profit.

“All identified assets, liabilities, rights and benefits” of
Kuwait Airways Corp. will be transferred to a new company called Kuwait Airways
Co. KSC, the Privatization Committee said in an emailed statement today.

Joint-stock companies listed on the Kuwait Stock Exchange
and specialized global companies can subscribe to 35 percent of the share
capital valued at KD220m ($804m), it said.

Kuwait’s parliament in January 2008 decided to sell shares
in the airline, which hasn’t had a profit since the 1990 Iraqi invasion. The
government planned to offer 40 percent of the stock to the public, 35 percent
to a strategic investor and 5 percent to employees, and keep the remainder.

Kuwait Investment Authority, the country’s sovereign wealth
fund, will own 20 percent of the new airline company, while Kuwait- based
airline operators won’t be eligible to bid for the stake, according to the
statement.

The Privatization Committee didn’t provide details of
selling shares to the public.

Citigroup Inc and Ernst & Young were chosen to carry out
the privatization, state-run Kuwait News Agency reported in August last year.
The carrier operates 17 aircraft including two Boeing 777s and a mixed fleet of
Airbus A340s, A310s, A320s and A300-600s.

The deadline for submission of expressions of interest for
the 35 percent stake is 5 pm Kuwait time on August 25.

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