The Austrian government nodded its approval Tuesday to the full privatization of ailing national flag carrier Austrian Airlines (AUA). In a compromise reached by the coalition of conservative OeVP and Social Democrat SPOe parties at a meeting in the chancellor's office on Tuesday, the government agreed that up to 100 percent of the airline's capital could be sold to the private sector. Nevertheless, a blocking minority of 25 percent plus one share had to remain in Austrian ownership, be it in private investors' hands or that of the state-owned holding company OeIAG. OeIAG currently holds 42.75 percent in AUA, institutional investors hold 7.25 percent, Austrian Airlines itself holds 3.55 percent and the remaining 46.45 percent is widely distributed. The contract for the full privatization could now be formally approved by the government cabinet on Aug. 12. OeIAG had asked the government for permission last week to sell its 42.75-percent stake as part of the continued privatization of the loss-making carrier, which is on the lookout for a strategic partner. The Social Democrat SPOe had insisted that Austria retain a blocking minority. Nevertheless, that could make it more difficult to find a strategic investor for the airline. Finance Minister and Vice Chancellor Wilhelm Molterer and infrastructure minister Werner Faymann said the blocking minority was an integral part of the privatization contract. And if there were not sufficient interest from domestic private investors, then OeIAG would hold a stake in AUA. Neither Faymann nor Molterer would comment on possible partners. “That is a matter for the appropriate decision-making bodies, not the politicians,” Faymann said.
