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Bahrain to raise Gulf Air capital by $1 bln -paper
Report says funds will be added to 2010 budget.
October 19, 2010 11:20 by Reuters
Bahrain plans to inject additional capital of 400 million dinars ($1.1 billion) into its loss-making national carrier Gulf Air , a local newspaper reported on Tuesday.
Al Wasat newspaper said Bahrain’s king had issued a decree to expand the state’s 2010 budget and had authorised the finance ministry to raise the funds from local and international capital markets. A spokeswoman for Gulf Air could not immediately comment.
The airline, which flew close to 6 million passengers last year, plans to break even in two to three years after a loss of $502 million in 2009, according to a document seen by Reuters.
Gulf Air has struggled to find a niche after previous owners Oman, Abu Dhabi and Qatar gave up their stakes partly to establish their own carriers.
It now focuses on regional routes in the Middle East to compete with airlines from top energy exporters such as Qatar Airways and Emirates Airline that serve global traffic linking Asia and Europe.
Bahrain plans to spend 2.19 billion dinars in its 2010 budget draft.
(Reporting by Frederik Richter; Editing by Will Waterman)