Russian Airline Transaero Expected to Cease Operations Any Day

Russia’s second-largest airline, Transaero, is expected to cease operations any day following the collapse of a takeover plan, international media reports said on Friday.

Transaero has been struggling with debt and last month a government commission arranged for most of the company’s shares (75 percent stake) to be taken over by the country’s largest carrier, state-controlled Aeroflot.

However, Aeroflot backed out of the deal as it did not manage to agree with Transaero’s creditors on restructuring its debts totalling an estimated 250 billion roubles ($3.78 billion).

The issue was discussed during a meeting headed by Russian Prime Minister Dmitry Medvedev on Tursday, October 1. According to reports, the Russian PM gave the green light to begin bankruptcy proceedings for Transaero airlines.

Meanwhile Russia’s federal aviation service has banned Transaero from selling any further tickets.

According to Transaero’s website, “the transportation of passengers-holders of the airline’s tickets on domestic and international routes will be provided until December 15, 2015. Passengers-holders of tickets for flights after 00.00 of December 15, 2015, will be able to get refund of the full ticket price”.

Aeroflot said in an announcement that it would ensure that Transaero fulfills its obligations to passengers and minimise negative social consequences for Transaero staff.

Greece and Cyprus monitor developments

The president of the Greek Tourism Confederation (SETE), Andreas Andreadis, expressed concern on the development as Transaero has deals with Russian tour operators that work with the Greek market.

Mr. Andreadis tweeted on Friday: “There are worrying messages about the possible bankruptcy of a large Russian tour operator that has a significant presence in our country. We are monitoring developments closely. “

According to reports in the Greek media, Transaero’s bankruptcy may affect a leading Russian tour operator that distributes more than 100,000 tourists annually to Greece.

Meanwhile, Transaero carries 70 percent of Russian tourists to Cyprus. According to transport minister Marios Demetriades, a probable failure of the airline could create a gap in Cyprus’s connectivity to Russia, which would affect the tourism industry.

According to the Cyprus News Agency, authorities in Cyprus are looking to assess how Transaero’s bankruptcy could affect tourists already vacationing in the country.

Russia is Cyprus’s second largest source of incoming tourists after the UK.