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Adria Shareholders Endorse EUR 2.5M Capital Injection (adds)

Brnik, 02 September (STA) - The shareholders of Slovenian flag carrier Adria Airways endorsed unanimously a EUR 2.5m capital injection on Thursday, but also tasked the management, at the proposal from small shareholders, to make a report on measures for boosting the company's operations within three months.

Adria Airways told the STA that the company would be provided fresh capital from its biggest owner, the state-run PDP restructuring fund, and three business partners.

According to the Association of Small Shareholders, the names of the partners are not known yet. Fuel retailer Petrol is not willing to become an owner, while Aerodrom Ljubljana, the operator of the Ljubljana airport, is mulling this option.

However, Aerodrom Ljubljana told the STA that it did not intend to take part in the capital injection, but was considering acquiring a stake in Adria's subsidiary Adria Tehnika, a maintenance company.

The airport operator would convert its claims of EUR 4.3m to Adria Airways, which are secured with aircraft spare parts, into a stake in Adria Tehnika.

Adria Airways management said that the existing shareholders would not have the preemptive right, while a group of fewer than 100 investors had been invited to subscribe for fresh shares.

The shareholders amended the decision on the capital injection with a request to the management to make within three months a report on implemented and envisaged measures to improve the company's performance.

The request was proposed by the small shareholders at the company and endorsed by chairman Maks Tajnikar. The small shareholders claim that Adria Airways had to immediately carry out financial restructuring, otherwise the third capital injection in the last three years will not be effective.

The shareholders told the management that cost-cutting is urgent as the upcoming winter months will bring a drop in revenues. They are also concerned that the company would not be able to pay the EUR 600,000 installment for the lease of two new Airbuses.

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