SriLankan Airlines ponders claiming Airbus graft damages

The Government of Sri Lanka is considering ways of recovering damages, including claiming compensation from France’s Airbus SE, after the planemaker admitted bribing executives to win Airbus orders.

“The reputational damage was huge, enormous,” Vipula Gunatilleka, chief executive of state-run SriLankan Airlines, said in an interview at the Singapore Airshow today. “That’s why our government is looking at certain remedial action.”

Airbus two weeks ago admitted illegally trying to sway plane sales and agreed to a record US$4 billion bribery settlement.

That included bribing the wife of the former CEO Kapila Chandrasena of Sri Lankan Airlines, who received US$2 million through a Brunei shell company, according to the U.K.‘s Serious Fraud Office.

Following the settlement, Sri Lankan prosecutors said Chandrasena and his wife, Priyanka Niyomali Wijenayaka, were suspects in a money-laundering case linked to Airbus aircraft sales. Chandrasena and wife have been refused bail after being hauled into court and are in remand custody unitl February 19.

“It was shocking,”Gunatilleka said. “When you hold a public office, you expect people to be credible. That trust was breached.”

An attempt by the Sri Lankan government to sell a 49 percent stake in the carrier seems to be off the table, Gunatilleka said.

The airline is restructuring, and that should be enough to revive its fortunes, he said.

“The previous government wanted to do it, but I don’t think they had a clear strategy,” Gunatilleka said. “As such, the airline was losing money. Who’d invest, who was going to come and buy even if you want to sell?”

Sri Lanka revived the process of privatizing the state-run carrier that is saddled with at least US$1 billion of debt in 2018, a year after talks with sole bidder TPG Capital collapsed following due diligence of the struggling airline.

Dubai’s Emirates Airline held 44 percent of SriLankan until 2010, when the government bought the stake following the end of a 26-year civil war. Part of the latest restructuring involves tweaking an order for Airbus A350 jets to A330neo planes or narrow-body aircraft, or a mix of both, as the airline seeks to move away from jumbo jets, Gunatilleka said.

The airline wants to increase its fleet to 35 by 2023 from 25 currently, he said.

The carrier has pulled out of markets, including Hong Kong, Paris, France, and Frankfurt, (Germany.-Bloomberg/The Standard)


  1. Aney No No !!! We can’t have an investigation. Imagine the can of worms that will open up. To believe that the CEO of Sri Lankan Airlines and his wife were the sole perpetrators of this scam would require an IQ of less than 10.

    How the Mahinda Rajapaksa “brains trust” covers this up remains to be seen. And, Ranil’s demand for compensation; smacks of jealousy. It is in the vein of : Mahinda’s team got the money and mine didn’t.


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