The long-awaited privatization of Azores Airlines, part of SATA Air Açores, has been given the go-ahead by the local government of the Azores.
Speaking to Aviation Daily about the process on March 8, SATA President and CEO Luis Rodrigues confirmed that a buyer was being sought to acquire a majority stake in the international airline. A “minimum [of] 51%” will be sold, up to a maximum of 85%, he said.
The potential buyer does not necessarily have to be another airline. However, some important conditions will be attached to the sale given the Azores’ remote location; the semi-autonomous Portuguese archipelago lies in the mid-Atlantic. The key requirement for any investor will be to keep adequate connectivity to the Portuguese mainland, Rodrigues said.
Tender documents will be published imminently as a next step, he continued. “As of then, any entity can consult [the documents]. They then should decide whether to move forward, upon which a couple of [non-disclosure agreements] and rules documents will give them access to the virtual data room,” Rodrigues said.
“Candidates have 90 days from the tender documents’ publication date in the EU official journal to submit proposals. In the meantime, management will be available for presentations,” the CEO said. Azores Airlines’ privatization was conditioned by Brussels when the EC approved the €453 million ($477 million) government-backed bailout of SATA in June 2022.
The EC-mandated restructuring required the creation of a holding company to replace SATA Air Açores as the parent of three operating subsidiaries, separating out Azores Airlines from domestic carrier SATA Air Açores and small airport operator SGA, which are not being privatized.
The final decision on the sale of the airline is expected in September or October, but Rodrigues will not be around to see it.
The CEO has been selected by the Portuguese government to lead flag carrier TAP Air Portugal—which is also being readied for privatization—in recognition of his work on the SATA restructuring. His appointment comes after the firing of his predecessor CEO Christine Ourmières-Widener and Chairman Manuel Beja with the government citing financial irregularities.
Speaking about the current business, Rodrigues said that Azores Airlines is operating at full capacity. “We are doing great—the year should be a record high again,” he said. However, the carrier anticipates a tough summer as SATA has “seen across the board initiatives to fix lack of ground-handling personal and airport constraints that may fall short. Admittedly, these are taking longer [than hoped] to correct,” Rodrigues said.
Looking back, summer 2022 ended up as the carrier’s best-ever year for services to North America, which is a strategic market for Azores Airlines. The carrier serves Boston, New York JFK, Toronto and Montreal.
Azores Airlines’ main fleet comprises three Airbus A320s and five A321neo/LRs. Domestically, SATA operates five De Havilland Canada Dash 8-400s and two Dash 8-200s that connect the archipelago’s nine islands.
Related Content
