On the eve of departure, SATA management recommends suspending the privatization of its subsidiary Azores Airlines

After the jury raised reservations about the financial capacity of the sole candidate for the purchase of Azores Airlines, the Newtour/MS Aviation consortium, the SATA administration, still chaired by Teresa Gonçalves, made a report on the process, which gave its opinion that the sales process should not move forward.

The company’s management considers not only that doubts are raised about the quality of the candidate, but also the value of Azores Airlines must be reviewed, following the results of the Azorean airline in 2023, better than those of 2022, which served as the basis for the evaluation from the company. Azores AIrlines recorded a loss of 24.3 million euros in 2023, an improvement of 8.1 million euros compared to the previous year’s result (32.4 million euros less).

The information that SATA management recommended that the privatization of Azores Airlines not be completed was provided by Antena 1 Açores. O Express questioned the company’s management about the report’s conclusions, but for now SATA management does not want to make any comment.

Meanwhile, Teresa Gonçalves and the financial administrator, Dinis Modesto, leave at the end of April, leaving the privatization dossier in the hands of the regional government, which has so far not commented. When Teresa Gonçalves’ resignation was announced, the president of the Regional Government of the Azores, José Manuel Bolieiro, did not clarify whether or not the privatization process would be suspended, referring to the future opinion of the administration.

However, he guaranteed at the time that the jury report was made impartially and without political interference, and that the law will be complied with. “This Government will do everything for transparency and above all for exemption”, he said in statements to Antena 1 Açores. He also defended the independence of the jury and stressed that there will be no political interference in this dossier.

A candidate who raises reservations

The final report of the jury that evaluated the offers to purchase the SATA subsidiary that makes extra-island flights, and which was led by Augusto Mateus, had already recommended that the advancement of privatization be considered, a commitment made within the scope of the restructuring of the Azorean company.

The jury raised reservations regarding the ability of the Newtour/MS Aviation consortium to ensure the company’s viability, leading sources familiar with the process to admit to the Express that the wear and tear caused by this process had a decisive contribution to the resignation. The Newtour/MS Aviation consortium was evaluated at 46.9 points out of 100, below half the average. And the jury warned of the need for “financial strength” to comply with the requirements of the privatization specifications, which everything indicates is not the case of the competitor.

However, after the jury’s final report, it was reported that the Angolan airline BestFly World Wide, majority shareholder of Transportes Interilhas de Cabo Verde (TICV) and shareholder of MS Aviation, announced that it was leaving Cape Verde and blamed this decision on the “environment of toxic and punitive business”, criticizing the way she was treated by the authorities.

Based in Austria, MS Aviation became owned by Bestfly in May 2023, an Angolan company founded and managed by Nuno Pereira and Alcinda Pereira. According to Lusa, Bestfly, which held the concession for inter-island flights in Cape Verde, saw services deteriorate due to a lack of planes, which led to the suspension of flights at the beginning of the month.

Unions against

SATA is the largest company in the Azores and one of the region’s main employers. And aviation unions, both SITAVA and SPAC, have spoken out against the privatization of Azores Airlines, and warned of the competitor’s fragility.

The Aviation and Airport Workers Union (Sitava) asked the Regional Government of the Azores to “immediately stop” the privatization of Azores Airlines. Speaking to the online newspaper Eco, the president of the Civil Aviation Pilots’ Union (SPAC) had already defended last week that the SATA administration give a negative opinion to the privatization of Azores Airlines, considering that the Newtour/MS Aviation consortium has no credibility and has “reputational gaps”.

SATA received public aid of 453.25 million euros in loans and state guarantees. In 2022, Azores Airlines recorded a loss of 24.3 million. This is not the first time that the regional government has tried to privatize Azores Airlines.