Saudi to undergo re-shuffle

Saudi Arabian Airlines is planning a major restructuring of its cargo operations, said Saud Arab, acting vice president for cargo and sales.

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By  Mark Foxwell Published  September 8, 2006

Saudi Arabian Airlines is planning a major restructuring of its cargo operations, said Saud Arab, acting vice president for cargo and sales. Arab told Air Cargo last month that the national airline is planning to privatise its cargo unit by the end of the year and will be putting the subsidiary out for tender in due course. “We believe that by privatising our cargo unit we will be able to introduce a new structure for cargo, in regards to making it a core business for sales and services, finance and human resources,” said Arab. He remained tight-lipped as to the percentage of the unit to be sold or the date for the deadline of bids, but said the process would be completed by the end of the year. “We are currently having in-depth meetings and are close to finishing our proposed programme to be completed by November,” he said. Saudia is also proposing a fleet expansion programme for its cargo operations. The company, which operates four MD 11 freighters and one Boeing 747, is looking at adding another plane to its fleet to expand into other markets. Arab told Air Cargo: “We are putting a proposed package together for an additional aircraft. This is likely to be either a Boeing 747 or a 777. We need to get final approval for our plan.” Again Saud Arab could not comment as to when the deal would be finalised, but said the privatisation of the cargo unit would give it more options to expand. Last month the company kicked off its long awaited privatisation by inviting bids for a 49% stake in its catering unit, with a deadline of the 27th of this month. This was made possible by the government’s recent decision to liberalise the aviation sector. The airline, which carried 16 million passengers last year, also hopes to privatise its baggage handling, pilot training, technical and maintenance units, some through public listings. A Saudi finance minister, who declined to be named, said earlier this year: “I strongly believe that Saudi Arabian Airlines could be the Kingdom’s next major privatisation.” In July, Saudi Airlines appointed a new general manager, Khaled al-Mulhim, who oversaw the privatisation of Saudi Telecom in 2003. He said his priority was to optimise the airline’s value before it goes public.

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