Bloomberg: Iran Air, the state-owned flag carrier, plans to sell its first shares to the public and buy as many as 100 new aircraft to expand in the face of tighter international sanctions, the company’s chairman said.
Bloomberg
By Ladane Nasseri
Iran Air, the state-owned flag carrier, plans to sell its first shares to the public and buy as many as 100 new aircraft to expand in the face of tighter international sanctions, the company’s chairman said.
Iran Air is seeking to modernize its aging fleet of foreign-built jetliners, which it operates amid political obstacles to the purchase of new planes and spare parts from European suppliers including Boeing Co. and Airbus SAS, Chairman Farhad Parvaresh said.
“Our company will be going into the Tehran Stock Exchange,” Parvaresh said in his first interview with foreign media since his appointment as head of the company last October. “We are creating the conditions for this. Whether that will be 100 percent, 70 percent, 60 percent, we are working on this.” He said it was too early to give a timeframe for the IPO.
An initial public offering would help Iran Air finance its planned expansion, even as the Persian Gulf country comes under a new round of sanctions over its nuclear activities.
The United Nations Security Council passed a fourth round of sanctions over Iran’s nuclear program in June. President Barack Obama intensified U.S. sanctions against Iran on July 1, targeting foreign suppliers of aviation fuel and other refined oil products and blocking access to the U.S. financial system for banks doing business with the country.
Unit Listings
Homa Hotels, an Iran Air subsidiary, is already listed on the Tehran bourse. Iran Air Tour, another unit, is expected to go public by the end of the Iranian calendar year on March 20, 2011, he said. Parvaresh did not provide a timeframe for Iran Air itself to issue and sell shares to the public.
The Tehran Stock Exchange, home of the world’s second-best performing equity index in the first half of the year, has a total value of 747 trillion Iranian rials ($75 billion).
The European Union tightened trade restrictions on July 26, banning fresh investment in or sales to Iran’s oil and natural gas industries, curbing export-credit guarantees, and monitoring more closely banks that do business in the country.
The U.S. and its allies accuse Iran of pursuing a nuclear weapons capability, an allegation that Iran rejects, insisting that its nuclear program is civilian and needed to provide electricity to a growing population.
“We have had restrictions to get planes but have made efforts and succeeded,” Parvaresh said at his office in Tehran. “We have restrictions to get parts, but have managed. It’s still difficult, but we are making efforts.”
Iran Air’s fleet includes 53 aircraft from Boeing, Airbus and Dutch manufacturer Fokker. The planes are 21 years old on average.
“We are always thinking about buying new planes,” Parvaresh said. “Perhaps we need some 100 aircraft. Boeing and Airbus are making a huge mistake not to use this market.”
The company, founded in 1962, will acquire new planes “whenever we have an opportunity,” he said. “It’s not very easy. Certain conditions need to be met, and when they are, we will buy.”
