SriLankan Airline’s divestiture hits a snag as no suitable investors expressed interest
By: Staff Writer
July 08, Colombo (LNW): Ports, Shipping, and Aviation Minister Nimal Siripala de Silva last week announced that SriLankan Airlines will be restructured rather than sold.
Speaking at the Presidential Media Centre (PMC), de Silva emphasised that current regulations limit the transfer of the airline’s shares to 49% to another entity. Despite this provision, no suitable investors have expressed interest in acquiring a stake.
“Our strategy focuses on restructuring SriLankan Airlines rather than selling it outright,” de Silva stated. “Under Sri Lankan law, only 49% of the airline’s shares can be transferred, but there has been minimal global interest, with only six individuals showing interest, none of whom were suitable. Even a Sri Lankan entrepreneur would need to prove their capability.”
In addition to airline restructuring, he revealed that the management of the financially troubled Mattala Airport will soon be handled by a joint venture between Russia and India. “Additionally, the Kankesanthurai port is undergoing development with $ 69 million in assistance from India,” he added.
He said during the recent visit of Indian Foreign Minister Dr. S. Jaishankar confirmed plans to launch a ferry service between Sri Lanka and India soon.
In addition, the Minister said the Japan International Cooperation Agency (JICA) is set to discuss resuming their projects next week, a benefit arising from ongoing debt restructuring efforts. “Although there has been interest from Chinese firms in airport projects, contracts with Japan mandate that these projects be awarded to Japanese companies,” he noted.
He also highlighted President Ranil Wickremesinghe addressing Parliament, outlining the ongoing debt restructuring crucial for the country’s economic recovery. “Despite political scepticism from the opposition, he maintained that the overall message was positive for Sri Lanka’s interests,” he said.
He pointed out that the International Monetary Fund (IMF) is heavily involved in the restructuring process, adhering strictly to legal frameworks and objective criteria. “Discussions to restructure Sri Lanka’s commercial debt are ongoing, guided by IMF assessments of economic resilience,” he added.
He said the President stressed the importance of moving beyond narrow political objectives and recognising international economic realities. “His administration has taken the first steps towards rebuilding from recent challenges, focusing on future stability to prevent a return to past conditions,” he said.
The Minister also said this year’s Budget includes allocations for provincial councils, pradeshiya sabhas, Government departments, and social security benefits such as “Aswesuma”, unrelated to upcoming elections.
