AIR NIUGINI SALE AND RESTRUCTURE –TOO GOOD TO BE TRUE

By JASON S TALI

Air Niugini:- From a dysfunctional underperforming SOE to a regional airline company in just under three (3) weeks.

Has anyone ever noticed that Air Niugini, the national flag carrier has ballooned in the last three weeks? It’s a success story too good to be true.

On 6th September 2014, the Government announced that it would sell 49% of the national flag carrier. In the most recent of times, Prime Minister Peter O’Neill and his full time bodyguard bouncer Ben Micah announced the partial sale of Air Niugini. They stated that the opportunity will be given to nationals (nationally owned companies and individuals) to purchase those shares.

After one week of that announcement to sell, Air Niugini announced the restructure of the company with the creation of what they now call “Link PNG”.

In announcing Link PNG, Fredrick Reiher, the controversial businessman involved in the Public Service Home Ownership Scam and Chairman of Air Niugini, said that “the establishment of Link PNG would ensure that rather than air services in the country being reduced by the ownership restructure of Air Niugini Ltd and the injection of private sector capital, as has occurred in other countries in the Pacific, they will actually be guaranteed and increased.”

Air Niugini CEO Simon Foo added the move was gearing Air Niugini to engage in smarter business practises in the delivery of its services, and in a cost effective manner.

On 1st November 2014, Link PNG was launched in Lae. The media accounts of the launching demonstrate that Link PNG will service routes to provincial and district centres which are currently being operated by the Dash 8 classic fleet including Mendi, Kundiawa etc. All others that Fokker 100 and others service will continue to be operated by Air Niugini.

Only a day before the launching of Link PNG, on Friday 31st October 2014, it was reported in the National Newspaper that Air Niugini is now vying to takeover other airline companies in the South Pacific region, either going in as joint ventures or outright purchasing them.

So it clearly seems that Air Niugini is revolutionising and grown in the last three weeks from a weak performer needing routine government cash injection to a major airline company in the South Pacific. Unbelievable!!

Some questions to ponder:

If they announced to conduct a partial sale of Air Niugini, why not allowing that to happen and see how it performs before restructuring the company with the creation of Link PNG?

Air Niugini is already a major service provider in all domestic centres. There are other third level airline companies servicing the rural centres like MAF, Airlines PNG and Travel Air. What is the utility of creating a separate Link PNG on the eve of sale? Any reason other than it relating to the partial sale is unthinkable.

Is it not a calculated reorganisation of the Air Niugini to make room for a relatively small player to purchase the 49% shares of Air Niugini? Mendi is conveniently mentioned here and makes one think of South West Air Limited, a small airline company based in Mendi. That company was recently purchased by Peter O’Neill and is now looked after by a trustee called John Donald BEATTIE, the principal of Pacific Legal Group (Jimmy Maladina is believed to be a part owner of the law firm).

Is it not logical that it would raise a lot of eye brows if South West Air (a similar to a tuckshop) took over Air Niugini (a Shopping mall)? Link PNG was a perfect bridge to subtly sell Air Niugini without raising unnecessary suspicions.

Is Peter O’Neill placing himself to be the next Richard Branson (Virgin Blue Airlines) of the Pacific turning South West Air to be the major airline company in the Pacific, thanks to Air Niugini?

How has he and is he acquiring all these wealth in a very short space of time?

You work it out.

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