Government mulls strategic partner for NAC

Government mulls strategic partner for NAC

The government is again giving a thought to restructuring of national flag carrier. The government is planning to amend the Nepal Airlines Corporation (NAC) Act that would pave the way to either convert it into a public limited company or bring in a suitable foreign strategic partner. A panel led by joint secretary at the Tourism Ministry Ranjan Krishna Aryal prepared a restructuring proposal and tabled it at the NAC board. Currently, the state airlines company, NAC has started discussion on the proposal, though the ailing airlines has in the past too, had such brilliant ideas that could not materialised. According to the proposal, there are three options for share divestment of the NAC. The first option; a three-party divestment involving government, a strategic partner and an initial public offering. The second; two-party share divestment involving government and a strategic partner. And the third one: an outright sale. The proposal has valued the national flag carriers's assets at Rs 32 billion. A potential strategic partner will have to invest at least half of the amount that is Rs 16 billion, the report stated. Earlier valuation of Rs 16 billion was revised after NAC is soon going to have eight aircraft by the next one-and-a-half year. Earlier in 2007 too, the government had planned to hand over NAC’s management to a foreign strategic partner to reform and rescue it but the plan failed.
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