US firm TPG pulls out of SriLankan Airlines bid talks

US private equity firm TPG, one of three bidders short-listed to buy a 49 percent stake in state-owned SriLankan Airlines, has pulled out of talks about the potential acquisition, the chairman of the national carrier said, according to the Reuters news agency.

Sri Lanka has been looking to sell the minority stake in the airline along with management control, part of a broader move to reduce its holdings in state-owned firms and cut debt.

“After completing the due diligence process, regrettably TPG have informed us they will not pursue a potential investment in SriLankan Airlines,” Ajith Dias, chairman of the carrier said in an internal memo to employees seen by Reuters.

“It is their opinion that allocating the human and financial resources to make the airline profitable will not realise sufficient returns, compared to the many other investment opportunities that are available to them,” he said.

Officials from TPG were not immediately available for comment.

TPG, Sri Lanka-based Peace Air and a Maldivian company had been short-listed from about nine bids for the 49 percent stake, including from U.S. investment manager BlackRock Inc.

The government called for bids in July and had expected to award the restructuring process by end 2016 but it said in February the bids from the three short-listed companies were too low.

Dias also said the government was pursuing other options to find a partner and the airline should continue on the path of improving its financial and operational performance.

The national carrier is struggling with colossal debt and decided to sell four new Airbus A350s after cancelling an order for four of the aircraft. It has also stopped some loss-making destinations to the Europe.


  1. We have lost confidence of world largest Investor of USA capital market .How can we expect join venture investment between Sri lanka and USA?

    The current Govt.think-tank has to study that simple truth is that No Airlines in world run -profit basis, except operational profit.
    Most of world Airlines back by Govt. funds by tax payers money ?
    All National Airlines in financial troubles the very bail-out comes from relevant Govt. treasures .
    That is fact an apply for Sri Lankan Airline too.
    The Current UNP regime make mockery of loss of profit Airline by political slogan against MR !

    These politicos can misled poor masses for short period of time but no Foreign investor will be in our-door step near future!!!

  2. Sri Lankan Government is very unstable and unpredictable now any it may collapse any time. Therefore foreign investors will not come to Sri Lanka within next two years. US involved in regime change to get a backboneless government but they will not burn their hands in investing money there.

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