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Russian government considers option not to privatize Aeroflot — deputy finance minister

May 18, 21:01 UTC+3 MOSCOW

Earlier, Aeroflot’s General Director Vitaly Savelyev backed the company’s privatization but noted that it should be carried out only after the company’s fleet is replenished

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MOSCOW, May 18. /TASS/. The Russian government is considering an option to privatize the country’s largest airline Aeroflot, Deputy Finance Minister Alexei Moiseev told reporters.

"There is such an option. Now they are discussing its possible exclusion from the privatization list," he said.

Earlier in an interview with TASS, Aeroflot’s General Director Vitaly Savelyev backed the company’s privatization but noted that it should be carried out only after the company’s fleet is replenished.

Currently, Aeroflot uses 30 Russian Sukhoi Super Jet-100 aircraft. In 2015, Aeroflot signed a memorandum for the delivery of another 20 aircraft.

Earlier President of the United Aircraft Corporation Yuri Slyusar said that in mid-2017, the parties plan to sign a firm contract on the basis of the memorandum. According to Slyusar, in 2017 it is planned to deliver 12 SSJ-100 aircraft to Aeroflot, and another 8 will be delivered in 2018.

It is assumed that the transaction will be financed by the State Transport Leasing Company (GTLK).

However, the Transport Ministry does not consider Aeroflot’s privatization feasible in the near future. According to Transport Minister Maxim Sokolov, since the state's share in the company is just over 50%, further reduction of this share will lead to the fact that it will completely lose control over strategic development decisions.

The idea to privatize Aeroflot has been the subject of discussions since 2004 when the company was put on privatization list. Later the idea was abandoned.

Aeroflot Group includes Aeroflot - Russian Airlines, Rossiya, Aurora and Pobeda. The main shareholder of Aeroflot is the Federal Property Management Agency (Rosimuschestvo) with a 51.17% stake. Aeroflot-Finance (Aeroflot’s subsidiary) owns 4.47% and Rostec Corporation controls 3.26%. Another 34.57% are kept by the National Clearing Depositary, which is a nominee shareholder. The actual shareholders of this stake are not disclosed. The company’s shares are traded on the Moscow Exchange.

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