Final restructuring plan for SriLankan to be submitted to cabinet

The final restructuring plan for SriLankan Airlines is to be submitted to cabinet for approval once it is endorsed by the new Board of Directors, the Finance Ministry said today.

The new Board of Directors under the Chairmanship of Ranjit Fernando was appointed at SriLankan Airlines in order to accelerate the restructuring process and create the enabling environment to proceed with entering into a Public-Private-Partnership with a strategic investor.

Other Board members appointed include Mano Tittewella (Ministry of Finance), Dr. Roshan Perera (Central Bank), Air Marshal Kapila Jayampathi (Air Force Commander) and Susantha Katugampala (Lawyer/Barrister).

The Finance Ministry said that Fernando was chosen to head the Board based on his experience in transforming the then State-owned National Development Bank where he served from its inception in 1979 until his retirement in 2001.

The Finance Ministry added that the restructuring of SriLankan Airlines and PPP process will continue to be guided by the Officials Committee chaired by the Secretary to the Treasury with the participation of the Secretary, Ministry of Public Enterprise Development and Chairman of the National Agency for Public Private Partnership (NAPPP), Thilan Wijesinghe.

Wijesinghe serves as the Convener of the Officials Committee. The Officials Committee, set up in September 2017, will continue to refer required areas for direction by the Ministerial Committee chaired by the Prime Minister and for implementation by the Board of SriLankan Airlines. Aviation Consultants, Nyras of UK, hired after a competitive process in November 2017 by the Officials Committee, will continue to report to the Officials Committee. This working arrangement is to ensure shareholder (Treasury) interests are adequately addressed in the restructuring process.

The Finance Ministry said that Nyras has presented a detailed business plan that demonstrates the SriLankan Airlines Group can become viable in the short to medium term through the restructuring strategy. This has similarities to the strategy adopted by Swiss Air and Aer Lingus, both advised by Nyras that resulted in turning these loss-making airlines turning into extremely profitable companies.

The NAPPP, with the assistance of Nyras, will coordinate the PPP process that will be implemented in parallel with the restructuring process and advise the Ministry of Finance and Officials Committee. The NAPPP will also advise the Officials Committee on the debt restructuring process designed to mitigate any impact on the General Treasury and State Banks, who are the largest lenders to SriLankan Airlines. (Colombo Gazette)