UPDATE: Russia Aeroflot 17 bln rbl costs of bailing out Transaero may pay off

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MOSCOW, Oct 23 (PRIME) -- Russian flagship carrier Aeroflot expects to compensate its 17 billion ruble costs of bailing out Transaero by using 56 international routes of the company, CEO Vitaly Savelyev told PRIME on Friday.

“We wanted to receive 92 out of 150 Transaero’s routes. But taking into account the situation we’ve asked for 57 routes. Eventually, we received 56… They were provided to us for a year, and each year we are to confirm how much money we’ve managed to repay,” he said.

The top carrier estimates its share on the Russian market for air transportation services after it gets the routes at 46-52%, Savelyev said.

Earlier the Transport Ministry said that Aeroflot will use 56 international routes of the troubled airline until October 30, 2016, with a chance of further prolongation.

Aeroflot may receive some of Transaero’s royalties along with some international routes of the troubled carrier, Savelyev also said.

Russian airlines get royalties from the 1990s, which are paid in a form of compensation for a difference in number of flights, a lack of transfer in Moscow and also within pool agreements.

New shareholders, which will buy Transaero, may need 30-60 billion rubles to bail out the company, and they are likely to apply for state support, the CEO also said.

Transaero failed to service its debts which totaled about 250 billion rubles. Booking of its tickets was halted and its passengers are carried by companies of the Aeroflot Group. Transaero’s air operating certificate will be revoked on October 26. Russian businessman Vladislav Filyov plans to buy no less than 51% in the troubled airline.

(62.7888 rubles – U.S. $1)

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