Russian national flag carrier Aeroflot may sell its largest affiliate Rossiya Airlines.
Aeroflot owns 75% minus one share in the affiliate, while the rest is owned by the government of St. Petersburg.
Deputy Prime Minister Arkady Dvorkovich ordered the Transport Ministry to prepare suggestions for the possibility of Aeroflot selling Rossiya Airlines. The Economic Development Ministry has submitted its position to the Transport Ministry, and the latter is to present its report to the government on October 10.
A source told that the ruling of Dvorkovich had been based on a report of the government’s expert council that the level of competition had fallen at the Russian market of air carriers. Another source said that no other airline in the world operated in three segments of the market, while Aeroflot itself was a premium air carrier and it had affiliates in the economy-class – Rossiya – and in the low-cost class – Pobeda.
Deputy Economic Development Minister Yevgeny Yelin said the ministry supported privatization and development of competition.
“We should improve accessibility of air travel from St. Petersburg, not only from Moscow”, he said.
One of the federal officials said that the Transport Ministry also favored the sale of Rossiya Airlines, while a representative of the ministry said it had formed a working group to study the airline’s development strategy. (Prime/Business World Magazine)