newstodate.aero

Feb 13, 2024 (newstodate): The final report of the special inspection on the ailing Estonian airline group Nordica deals a harsh blow confirming that the company was not well managed.
   -The management of the company took the direction of expansion, but the risks related to various contracts and projects were not assessed sufficiently. New investments were also insufficiently analyzed. The content, limitations and risks of the contracts signed in certain projects were only analyzed after the contract was signed and problems appeared, says the Estonian Climate Minister Kristen Michal on the Ministry's website.
   -Although Nordica's situation continues to be difficult, the new management has been able to identify all costs and risks and increase the company's efficiency. This allows us to hold meaningful negotiations with interested companies for the privatization of Nordica, the minister adds.
   The final report reveals that before starting new projects and making transactions, not enough attention was paid to the accompanying risks and their possible mitigation measures. Also, on its own initiative, the board did not provide the council with sufficiently comprehensive and objective information about the impact of the decisions on the company. The Council, in turn, has not requested enough additional information.
   Owner of Nordica, the Estonian state has made it clear that only two alternatives remain: either divesting of the assets to potential new owners, or an outright liquidation.
   Sources claim that a final decision will be made by early March 2024, already, with negotiations with "several" parties ongoing.
    The Estonian state is prepared to sell the company comprising XFly and Nordic Aviation Group either as one package or in parts, while the similarly state-owned aircraft leasing company Transpordi Varahaldus is not currently up for sale, while still poised for privatization at a later stage as well.
   Headquartered in Tallinn, the Nordica group operates flights under two brands, two IOSA-certified AOC’s - XFLY operating nine ATR72-600 and nine CRJ900 and Nordica operating four A320 aircraft.