Investors interested in Cyprus Airways (CY) must submit non-binding proposals by the end of the month, the company’s chairman said on Friday, as low-cost airline Ryanair said it could put it back on rapid growth.
Proposals will be reviewed on September 30 and a short list will be drafted, Tony Antoniou said.
The procedure could be completed by the end of the year, the chairman said after a meeting between the negotiating team and Ryanair CEO Michael O’Leary on Friday.
Ryanair was among 22 companies which last month submitted non-binding expressions of interest in the airline, now controlled by the Cypriot government.
The process is a preliminary step towards any eventual binding offer.
O’Leary’s announcement marked a change of approach as he had said last month that Ryanair, Europe’s largest budget airline, was not particularly interested in acquiring the carrier.
Antoniou said 15 companies have submitted non-binding proposals. Officials from Greece’s Aegean Airlines will be in Cyprus next week for discussions.
“There is a big response despite people saying Cyprus Airways was worthless,” Antoniou said. “CY will exist in different form. We will have a carrier based in Cyprus that will fly to more destinations.”
The airline has struggled to survive against cheaper competitors and has been loss-making for years despite several attempts at a turnaround.
It resorted to selling assets to stay afloat, including its slots at London’s Heathrow airport.
CY is also under scrutiny by the European Commission. Brussels is investigating terms of a €31.3 million capital increase in early 2013, and a €73 million rescue package by the Cypriot state in 2012 to establish whether it violated state aid rules.
O’Leary said that with the help of the Irish airline, CY could get back on a path of rapid growth with new routes and more flights that would drastically increase the number of passengers.
“From Ryanair’s point of view there is a very exciting future for Cyprus Airways where I believe with the help of Ryanair we could put Cyprus Airways and Cyprus` tourism back on a path of a very much renewed and rapid growth, with new routes, more flights and new jobs for pilots, cabin crew, and engineers here in Cyprus,” O’Leary said.
Ryanair’s CEO also met Communications Minister Marios Demetriades.
O’Leary said that with the plan Ryanair submitted, it expected to grow from 500,000 passengers last year, to about three million passengers over the next three to four years.
“As we explained to the minister we think we can deliver that growth using Cyprus Airways. So it will be Cyprus Airways growing again from 700,000 passengers this year to three million in the next few years,” he said.
The minister said the government will examine the proposal.
“It is a lengthy proposal and the government will have to take a careful look at it to see whether it meets our expectations and we of course have our own proposals,” he said.