By Staff writer
Sawaris told CNBC interview that there is potential to buy airlines for as little as $1
Egyptian billionaire and telco tycoon Naguib Sawiris has said there is potential to purchase struggling airlines in the current economic tailspin for as little as $1.
In an interview with Hadley Gamble from CNBC International, Sawiris said the Covid-19 crisis presents a number of opportunities for investors, particularly in the aviation industry and also in tourism, where the occupancy rate during the pandemic has been slashed as a result of global movement restrictions as countries strive to curb the spread of coronavirus.
He said: “I see them (opportunities) in all the airlines business and all the hotels that are not sustained, to go down. All the Internet companies that don't have any advertising revenue. But mostly I see in tourism and hotels or airliners. I mean, you can go and buy an airline today for $1. If you are assuming the bulk of the debt, so there is no equity that you put.”
Last month, Virgin Australia become the first major casualty of the Covid-19 crisis when it was placed in voluntary administration, while earlier this week, Sharjah-based Air Arabia reportedly laid off 57 employees and Virgin Atlantic announced plans to cut over 3,000 jobs.
The International Air Transport Association (IATA) estimates airlines will lose $314bn in revenue this year and will require $200bn in government aid.
IATA has urged governments to quickly implement pledges of financial support for carriers, warning that 25 million jobs are at risk in a scenario where three months of travel restrictions are combined with a plunge in air travel demand.
Meanwhile, Sawiris does not expect the global economy to recover before 2022.
“I am very bleak about next year. I have a firm feeling that the next year would be a depression. I am firm believer that next year we will have a major cash crisis. And life would not go back that easily to where we were,” he said.
Sawiris has been an open critic of the mass lockdown measures and has previously said on social media that “life needs to go on” while also saying “are we going to stop living because we're afraid of this virus?”
He added: “I think many businesses will not sustain the pressure. So my point going back to work was, listen, they might not find the cure, they might not find the vaccine. So how long are we going to be in prison in our homes? So it is best if intelligent brains determine the cause of the virus.
“So let's go to offices and stay away from each other for three meters and kill our hands with washing and this blue stuff. Life goes on. I’d love to open restaurants, even if they make the tables a bit far from each other. The bar stools they space out and we go back to life.
“I mean, I call it trying to kill mosquitoes with cannons. This is how we have reacted to this virus. I am not saying people aren’t dying, everything has to be taken in context.”