Etihad Airways will announce in the upcoming days that it will not renew the management contract with Air Serbia that expires early next year, a specialized aviation portal, Exyuaviation has reported.
Etihad Airways will retain its 49% minority stake in Air Serbia, however, it will not renew its Management Services Agreement with the airline, which expires on 1st January, 2019.
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Etihad signed a dozen agreements with the Serbian government upon its partial takeover of Jat Airways almost five years ago. They include an Investment Agreement, Shareholder Agreement, Management Services Agreement, Agreement for the Provision of Grants to Air Serbia by the government, Training Agreement, Travel Services Agreement, Convertible Loan Facility Agreement, and Frequent Flyer Migration Agreement.
A number of high-ranking positions at Air Serbia are currently held by Etihad employees, including the post of Chief Executive Officer, Chief Financial Officer and Chief Operations Officer.
The departure of Etihad-appointed staff will coincide with the transfer of the airline’s revenue management and network planning departments from Abu Dhabi back to Belgrade next January.
To remind, Air Serbia’s General Manager, Dane Kondic, who has been managing the company since its establishment, left the company at the end of last year. Previously, Air Serbia’s long-standing general manager, James Hogan, the creator of an unsuccessful strategy of Air Serbia acquiring shares in failed European airline companies, was practically thrown out of Etihad. Air Serbia has been recording a sharp decline in business results for a long time, having huge losses that are covered by state subsidies. Also, the passengers reported lower quality of services, while the Serbian national airline also quietly withdrew from acquiring 10 new Airbus A320NEO planes.
(Danas, Exyuaviation, 12.06.2018)
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