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Bidding competition to lease military repair firm cancelled

DEFENCE Minister Martin Glváč has scrapped the launched bidding competition to rent the loss-making state company Letecké Opravovne Trenčín (LOT - Aircraft Repair Company Trenčín) to private management.

(Source: TASR)

One of the reasons was the lack of interest shown by potential bidders. None of the key players in the aeronautics industry wanted to lease the firm for a period of 20 years, the Sme daily reported.

“Before announcing the competition to find a strategic partner, we had signals that strong foreign partners would participate in the international tender,” Glváč said, as quoted by Sme. “Unfortunately, this has not been the case. Therefore, I have to say that for now, the best partner for the company is the state.”

LOT ended last year with a loss amounting to €4.1 million. Glváč claims he has “an alternative solution” for keeping the company employing 320 people. The ministry has not yet revealed further details.

Read also:Unions balk at plan to rent out loss-making military repair firm

Originally, five companies applied for the tender in the first round, four advanced into the second round, and one pulled out. The remaining three companies submitted their offers.

Conditions for the winner were cost of rent, guarantee of employment and the purchase of the company’s tangible fixed assets. The tender was cancelled by LOT board chairman Milan Mutala based on a recommendation of the selection committee.

“From our point of view, the companies that have participated in the tender are not a guarantee of employment in the region or of the revival of the company,” Glváč said, as quoted by the TASR newswire.

The company now has to rely on strategic state orders. The ministry is also negotiating other contracts from abroad, namely from Croatia and the United States. Glváč said he will also discuss the provision of service activities for Interior Ministry's helicopters with Interior Minister Robert Kaliňák, TASR wrote.

According to Viliam Jánošík, head of unions at LOT and a member of the selection committee, this competition was perceived as being very sensitive by society.

“The maintaining of employment in aviation maintenance activities in the aircraft industry are very closely related to required certification,” Jánošík said, as quoted by TASR. “Due to the fact that these companies don’t possess them, there would be serious problems in the short term after they had taken this company.”

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Topic: Military


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