Marfin Entertaining Acquisition of JAT to Merge with Olympic Air

As Serbia’s state-owned JAT Airways continues to experience heavy financial losses, Greek investment firm Marfin Investment Group has expressed interest in acquiring the troubled airline. Marfin purchased Greek Olympic Airlines last March and would most likely merge it with JAT to create a strong regional airline. The firm also acquired a 50% stake in Switzerland’s Ambulance International Rent-a-Jet earlier this year. Serbia has been seeking a strategic partner for JAT since the spring of 2008 when it offered a tender for 51% of the company at a €51 million call price.

JAT Airways (www.jat.com)
JAT Airways is the state-owned Serbian airline based at Belgrade’s Nikola Tesla airport. The air carrier offers domestic and international flights to 32 destinations across Europe, Africa, and the Middle East. JAT also provides charter, livery, and cargo services as well as in-flight meal preparation via its wholly-owned subsidiary, JAT Catering.

The company currently employs more than 1,800 people including pilots, flight attendants, support personal, and office workers.

Olympic (www.olympicairlines.com)
Olympic Airlines was established in 1957 by Greek millionaire Aristotle Onassis. Providing service to 35 domestic destinations and 39 others world-wide, the company employed nearly 8,500 as late as 2007. The airline has faced mounting financial problem since the mid 1980s, due in large part from operational mismanagement.

Marfin Investment Group (www.marfininvestmentgroup.com)
Marfin was founded in 1998 under the name Marfin E.P.E.Y., with the original investment strategy of focusing on the Greek banking sector. These investments matured and realized the formation of Marfin Popular Bank in 2006. The company divested itself of its banking assets in May 2007 and separated from Marfin Popular Bank.

Marfin’s current investment strategy is based on the principle of investing in already sound businesses with a goal of consolidating fragmented industries. Their six main sectors of investment are financial, food & beverage, healthcare, hospitality & leisure, information technology, and shipping & logistics.

Institutional investors from Dubai account for approximately 38% of Marfin shares, domestic institutional investors about 15.5%, and the remaining shares are owned by foreign institutional investors and others.

Marfin completed a € 5 billion capital increase in 2007, and along with the sale of Marfin Popular Bank realized a tremendous return for its investors.