BELGRADE, July 5 The United Arab Emirates' (UAE)
Etihad Airways is nearing an agreement over an equity investment
in loss-making Serbian flag carrier JAT Airways, the
Belgrade-based Blic newspaper reported on Friday, citing
Serbia is aiming to offload loss-making state firms,
including JAT, Galenika pharmaceuticals and the Zelezara
Smederevo steel mill, to keep 2013 budget deficit at about 4.7
percent of output and secure growth of up to 3 percent.
Last month, Etihad and JAT signed a preliminary agreement
over a possible equity investment, pending due diligence and
Earlier this week, Serbia's Deputy Prime Minister Aleksandar
Vucic said he was hoping for a successful deal with Etihad,
adding that JAT Airways should be renamed Air Serbia.
"We will be ... proud of Air Serbia, which will be more
successful and better than JAT Airways," Vucic said.
The Blic said the talks between Etihad and JAT also involved
purchase of maintenance company JAT Tehnika and JAT Catering.
The deal could be signed within two weeks, the report said
without specifying the price.
Previous attempts to sell JAT have failed due to lack of
interest from prospective buyers.
Earlier this year, the Serbian government said it was ready
to take on 170 million euros ($219.5 million) of JAT's debt,
which last year stood at 3.68 billion dinars ($43.1 million),
pay leases for six new aircraft from EADS's Airbus and
secure severance payments for redundant workers.
JAT currently operates 10 Boeing 737-300s and four
ATR 72-200 turboprop aircraft on 30 routes
within Europe and to the Middle East.
($1 = 0.7744 euros)
(Reporting by Aleksandar Vasovic; Editing by Mark Potter)