Air Jamaica privatization study

The company contracted by the government last year to oversee the divestment of Air Jamaica has provided a progress report on its activities.



International Finance Corporation (IFC) the private arm of the World Bank

said based on the findings of a due diligence study, Air Jamaica is considered a significant turnaround opportunity for an airline investor.



The study commissioned by IFC was done by GRA Incorporated, which found that the national airline has approximately 50 per cent of the total market share of travelers to and from the island and 70 per cent of the airfreight market between Jamaica and the rest of the world.



At least two investors have so far been confirmed.



In a progress report of activities over the 10-month period leading up to January 31, IFC said it had successfully implemented a number of measures aimed at making the airline attractive on the open market.



The report, which was released by the Air Jamaica Privatization Committee, said IFC acquired 1.6 million US dollars in donor funding.



The funding has allowed the government to contract a team, which includes international airline consultancies SH,&E and GRA Inc. and international legal consultants, Hughes, Hubbard & Reed to assist with the project.



The report said IFC and the consultants also developed a 17-point action plan, aimed at improving Air Jamaica’s financial performance.



Implementation was delayed until a new management team was put in place at the airline.



A website – www.airjamaicatransaction.org – has also been established to allow public access to basic information about the Air Jamaica Privatization Project.



A process of registration also requires that investors to submit information which is reviewed by the Privatization Committee.



A registered investor agrees to protect the confidentiality of all information he receives.



The winning investor will be the one who submits the proposal that most closely meets the government’s objectives for the divestment of the airline.