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Finnair ready to consolidate

Eero Heliövaara, who is also the chairman of the shareholder's nomination board at Finnair, spoke at the airline's general meeting on Thursday.

Finnair is ready to consolidate or to establish a joint air venture with another airline, indicated both board chairman Klaus Heinemann and CEO Pekka Vauramo in their addresses at the general meeting of the state-owned airline on Thursday.

Heinemann viewed in his opening address that maintaining the ownership structure of Finnair may not ultimately be in the interests of the airline. According to him, Finnair should instead transfer some of its shares to another airline through an offering or share exchange offer.

“Companies such as Finnair have become a dying breed of air transport. It is clear that consolidations will continue in Europe,” Heinemann stated, encouraging shareholders to consider the alternative ownership options available to Finnair.

Heinemann later revealed that the partner could be based in either Europe or Asia. “The company should be one that has no problem with our Asian strategy,” he said, refusing however to speculate on the identity of the partner.

It is “likely”, Heinemann estimated, that some shares in Finnair are sold or exchanged with another airline. “The company will surely be one that would benefit from the position of Helsinki as a hub for Asian traffic – a company that could thereby boost its passenger volumes.”

However, a complete consolidation “is not the most likely path forward at this point,” he said.

“There is a major difference between exchanging 100 and 20 per cent of shares. We want to ensure that the fate of Finnair remains in its own hands,” he explained.

Eero Heliövaara, the director of the Government's ownership department, estimated after the general meeting that the remarks of Heinemann and Vauramo are indications that Finnair has a clear strategy in place for the expansion of its ownership base.

“You can do that without losing the name Finnair, the head office or the Helsinki Airport. You can do all that while preserving Finnair and state as its central owner and decision-maker,” he commented.

The sale of shares in Finnair would require the approval of the Finnish Parliament.

“[Giving up the majority ownership] is purely a political decision that requires a certain degree of maturity. I think we are closer to the maturity than we were a few months ago, for example,” Heliövaara gauged.

Tuomo Pietiläinen – HS
Aleksi Teivainen – HT
© HELSINGIN SANOMAT
Photo: Kalle Koponen / HS