Estonian Air's year-old business strategy has failed, according to an analysis by Eesti Päevaleht, due to the selection of the company's directors and the rash implementation of infeasible plans, leaving nothing but bad options to choose from.
The newspaper's analysis caused a fuss when it was published on Friday, with a key figure denying having made assertions that were attributed to him through an alleged leak.
According to the analysis, Parliament's Economic Affairs Committee held a confidential meeting on September 25 where three options were outlined for the national air carrier: a quick sale of the company to an investor, a 60 million euro cash injection from the state, or bankruptcy.
Out of these three scenarios, the Eesti Päevaleht analysis says the sale or takeover of the company is the least likely, because nobody is interested in acquiring a small-scale airline in financial trouble, and bankruptcy is the most likely, because the state has not yet decided whether it will funnel more money into the company to bail it out for the second time.
But speaking to ETV, Erkki Raasuke, the chairman of Estonian Air's supervisory board, denied the newspaper's assertions that bankruptcy was on the list of options and that he had criticized Estonian Air CEO Tero Taskila for bringing the company to its knees with his new strategy.
The newspaper's analysis said Minister of Economic Affairs Juhan Parts should also be held accountable for ignoring warnings when the newly appointed Taskila presented his new strategy in 2011.
Critics included Minister of Finance Jürgen Ligi and Auditor General Mihkel Oviir, who expressed alarm over the strategy. Ligi had noted that the "strategy resembles Air Baltic's actions up to now, which have repeatedly led to the need for further capital injections by the owners, meaning that the implementation of the strategy has failed."
It was revealed this summer that Estonian Air had burned through 30 million euros received from the state within half a year. The money was used to cover the existing 10 million euro deficit and the additional 15 million euro loss sustained in the last six months, reported Eesti Päevaleht.
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