* Air France-KLM, Aeroflot, Odien, Unimex interested in CSA
* Winner to be known by the end of September
(Adds Aeroflot comment)
By Jana Mlcochova
PRAGUE, March 23 (Reuters) - The Czech Republic received
four preliminary bids for its 91.5 percent stake in Czech
Airlines CSA and said the winner should be known by the end of
September at the latest.
Aeroflot <AFLT.MM>, Air France-KLM <AIRF.PA>, private equity
firm Odien and a consortium comprising Czech Unimex Group and
Travel Service all submitted applications in the first round of
tendering, the finance ministry said on Monday.
The government is selling its stake in the airline as a
global economic slowdown has sapped travel demand, putting
airlines under heavy pressure.
Analysts expect the sale of what is a relatively small
European airline hit by leasing costs as well as the economic
downturn to fetch up to 5 billion crowns ($255 million).
Bidders need to meet conditions such as keeping CSA's
national identity status to prevent the airline losing
international routes outside Europe.
That could happen if CSA was sold to a foreign buyer because
of a global system of bilateral agreements between countries
governing which airlines can fly where around the world.
Non-Czech bidders will therefore have to combine with Czech
entities in consortia to fulfil that condition.
Aeroflot's deputy general director said it had already lined
up a partner and part of the funding.
"The difficulty was finding a partner in Europe that would
share the risks and financial investments," Lev Koshlyakov said.
"But now we've lined up a partner."
Koshlyakov told Reuters Aeroflot had worked out how to
secure the first part of the financing to buy the stake. "It is
possible to get a loan on the international market," he said.
The Czech government will also assess bidders' security
risks with politicians having voiced concerns about Aeroflot's
ownership structure. Koshlyakov declined to comment on the
matter.
The Russian carrier has long been on the lookout for
acquisitions in Europe, and chief executive Valery Okulov,
son-in-law of Russia's first president, Boris Yeltsin, told
Reuters in September last year the company was eyeing two
possible acquisitions, including Czech Airlines.
Air France-KLM said it was entering the process to gain
access to CSA's data.
The airline, which sees itself as a major player in European
industry consolidation, said Czech Airlines' flight network was
highly complementary to its own and would enable it to
strengthen its position in central and eastern Europe.
Air France has described Czech Airlines as a close partner,
particularly through their membership of the global SkyTeam
alliance of airlines since 2001.
Aeroflot, a SkyTeam member since 2006, said it would not
consider any further acquisitions in Europe if its bid for CSA
was successful. "In the near term I doubt we would be looking
for anything else," Koshlyakov said.
CSA made a pretax profit of $550,000 in 2008 on operating
revenue of 23.2 million Czech crowns.
Management ended three years of losses in 2007 after cutting
costs and boosting revenue by selling off non-core assets,
including its catering division, and by selling and leasing back
planes.
(Additional reporting by Anton Doroshev in Moscow, Editing by
Dan Lalor and Greg Mahlich)
($1 = 19.64 Czech crowns)
