OA sell-off is still flying

A day after the European Union ordered Olympic Airlines (OA) to pay back more than 500 million euros in illegal state aid, the government vowed yesterday to try and keep the national air carrier flying despite its apparent crippling financial situation. A joint ministerial meeting decided that the government will push ahead with attempts to sell the state-owned airline, assuming that investors are still interested. «The decision of the European Commission will be communicated to all investors to determine their intentions. This will help determine if – under the new conditions – they are interested in buying the company,» the Finance and Transport ministries said in a joint statement. The EU ordered Greece on Wednesday to recover millions of euros in state aid the airline received from the previous Socialist government, arguing that it gave it an unfair advantage over its competitors. The Commission did not specify how much the loss-making airline needs to pay back. Some estimates place the amount as high as 700 million euros. EU laws ban state subsidies to airlines and companies that received such funds are required to repay them. Sources say that the EU decision is likely to scare away the consortium of investors that had signed a preliminary agreement to buy OA last month. The government has been fighting off criticism that it has done little to protect OA which it says costs the taxpayer 1.5 million euros per day. Goverment spokesman Theodoros Roussopoulos denied claims that the state is preparing to pull apart the airline and sell off its profitable services. Government sources said yesterday that Greece is working on an action plan and will exhaust all options toward keeping OA alive, including appealing against the Commission’s decision by taking the matter to court. Transport Minister Michalis Liapis said Greece would wait until it receives the full text of the EC decision before determining its exact response. OA workers continued their protest action late yesterday, demonstrating outside the Finance Ministry where the joint ministerial meeting took place. The state repeated that OA workers will have their jobs protected in the public sector.