Russia’s Yakutia acquires Polar Airlines

Yakutia and Polar Airlines will continue to operate separately but coordinate their fare policies. Yakutia purchases 100% minus one share of Polar Airlines (Photo by Polar Airlines)

Yakutia Airlines and Polar Airlines, the two carriers controlled by the government of Russia’s Republic of Yakutia, have merged. The two Russian airlines will continue to operate separately but coordinate their fare policies.

Yakutia became the owner of 100% minus one share of Polar Airlines. The remaining golden share will remain in the hands of the republic’s ministry of property relations to enable the local government to block decisions that may prejudice the rights of either party. The shares were purchased at their market value, for the total amount of 911.4 million rubles ($15 million).

Nevertheless, both carriers will remain separate legal entities, writes TASS newswire. The shareholder agreements necessary to regulate the companies’ operational activities will be signed in the first quarter of 2017. The route networks, fleets and offices of both airlines will remain intact for the time being. Basically the airlines will carry on with their own operations, but the fare decisions will be made jointly.

Initial plans called for Yakutia and Polar merger to be completed by September this year, in line with the government’s road map for creating an aviation holding. The aim of the merger was to improve the efficiency and competitiveness of the region’s air transport sector. Polar Airlines’ management expressed confidence that the merger would integrate the best of the two operators. Yakutia in its turn, noted that the priority task was to reach synergy in flight schedules and improve management efficiency. The two carriers earlier signed a code-share agreement.

Yakutia Airlines currently has 21 aircraft registered in its fleet: a Boeing 757-200, five Boeing 737-800s, three of each of Bombardier Q300, Bombardier Q400 and Sukhoi Superjet 100s and six An-24s. In the period from January to November this year Yakutia carried 632,100 passengers, up 6.8% from the same period last year. It is now number 18 in the Russian airlines rating by traffic.

Polar Airlines, which, besides passenger transportation, holds a certificate for aerial works, operates a fleet of 37 aircraft, including two DA 40NGs, two L-410UVP-Es, a Pilatus PC-6, four An-2s and the same number of An-3Ts, five An-24s, three An-26s and sixteen Mil Mi-8MTV-1 / Mi-8T helicopters. At the end of 11 months of this year it served 106,600 passengers, down 3.2% year-on-year, and occupies 34th position in the rating.

The government is eyeing the opportunity for another airline active in the region, Alrosa, to join the merger some time in the future. Its traffic grew 23.6% so far this year to 394,700 passengers. It takes the 23rd place in the list of Russia’s largest airlines by passenger traffic, and is also certified for aerial works.

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