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Oct 13, 2009 11:22 EEST
October 13 (SeeNews) - U.S. Citibank is in talks to finance Serbia's JAT Airways after the government in Belgrade pledged to guarantee a credit of up to 40 million euro ($59.1 million) for the troubled flag carrier in 2010, Serbian broadcaster b92 reported.
The Serbian government has committed to help the air carrier pare its losses, restructure and prepare for a new attempt to find a strategic partner, b92 (www.b92.net) reported on Monday, quoting unnamed sources from the airline.
A tender for the sale of 51% of JAT Airways at a call price of 51 million euro failed last year as no bidders turned up.
As part of its turnaround plan, JAT Airways plans to spin off non-core operations, shed a third of its 1,500 staff and dispose of properties that have been leased out, b92 said.
A team of Boeing officials is expected to pay a new visit to JAT Airways over the next ten days after holding a round of talks in Belgrade about a month ago, b92 said, adding there were no further details about the negotiations. Local media reported last month Serbia was in talks with Boeing on the purchase of up to five new passenger jets for JAT.
In April, local media reported that the average age of JAT's 16-aircraft fleet is 20 years. The company, which is expected to pare its loss by at least 5 million euro this year from 29 million euro in 2008, needs to increase the number of passengers it transports to 1.5 million a year from 1.36 million in 2008, JAT Airways said in a cost-cutting plan it presented recently to the government.
JAT posted a 18.5% annual drop in the number of passengers it carried in the first eight months of the year to 659,600, data of the Association of European Airlines indicated earlier this month. The carrier has forecast it will board 1.1 million passengers this year.
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