SEYCHELLES – The government of Seychelles had reached a deal to take full ownership of Air Seychelles, following talks with Etihad Airways in which the UAE-based airline agreed to relinquish the 40 percent stake it holds at a steep discount, Seychelles News Agency has reported.
Air Seychelles had owed US$72.3 million to Etihad; with the 79 percent write-down, Seychelles will pay US$11.34 million.
A total of $71.5 million is still owed to bondholders.
Etihad Airways entered a partnership with Air Seychelles in 2012, when it bought a 40 percent share in the national airline.
Etihad has been looking to clean its hands of foreign airline investments in the wake of the COVID-19 pandemic.
The remaining 60 percent belonged to the government of Seychelles, a 115-islands in the western Indian Ocean.
Under the original deal, the funds provided by bondholders would be split between the United Arab Emirates (UAE) carrier and partner airlines.
Each company assumed the responsibility to pay off its debt before the bond reached its due date in 2021.
Incumbent executives at Air Seychelles, including Remco Althuis, Chief Executive Officer, and Michael Berlouis, Chief Financial Officer, will remain in position until June 30th, 2021. A new board will come into force on June 30th, with Nane Nanty as the chairperson and Alan Mason as its co-chairman.
“This is a time of opportunity for both Air Seychelles and the country, as tourism starts to rebuild following the reopening of its borders. Seychelles is an important destination on Etihad’s global network, with bookings steadily increasing,” a statement from Etihad said.
US$11.4 million of funding will be to pay off the Etihad debt, while US$20 million will go towards paying bondholders.