November 25 (SeeNews) - Moldova's Civil Aviation Authority (CAA) said that flag carrier Air Moldova is in danger of insolvency and asked it to submit a plan to remedy its vulnerabilities.
An inspection of activities at the company detected serious deficiencies of financial nature, which can disrupt its smooth functioning and the safety of its planned air operations, the CAA said in a press release on Thursday.
The authority is asking Air Moldova to submit a corrective action plan to remedy the precarious financial situation, in order to ensure proper functioning.
CAA also prohibited Air Moldova to promote flights for 2023 summer schedule until its flight plan is approved.
In a statement issued on Thursday, Air Moldova said that CAA's request to stop the sale of tickets for the 2023 season is "unfounded and illegitimate"
State-owned Air Moldova was established in 1993 and currently operates direct flights to various destinations such as St. Petersburg, Krasnodar, Tel Aviv, Istanbul, Antalya, London, Dublin, Frankfurt, Paris, Nice, Lisbon, Rome, Milan, Verona, Thessaloniki, Heraklion, Prague, Tbilisi and Sharm el Sheik.
In 2018, the company was bought by Romania's Civil Aviation Group for a price of 1.3 billion Moldovan lei ($68 million/65 million euro), which included debt of 1.25 billion lei. A year later, Blue Air aviation, which owned 49% of Civil Aviation Group, sold its stake stake to Latvian businessman Dzintars Pomers.
Air Moldova booked a net loss of 190.4 million lei in 2021, compared to a loss of 100 million lei a year earlier, while its turnover fell to 2.73 billion lei from 3.01 billion lei, data from the finance minsitry indicated. At end-2021, the company employed 573.
In September, CAA said it is banning all local airlines from operating in Russian airspace after Air Moldova said it is resuming flights to Moscow due to high demand. The decision was taken for safety and security reasons, CAA said at the time.
(1 euro=19.8907 lei)