End of runway for Bahrain Air as company shuts down

February 16, 2013

Bahrain Air has reached the end of the runway after its shareholders announced the company’s immediate suspension of operations. The private airliner, set up in 2008, said that it was filing for voluntary liquidation in accordance with Bahrain’s Commercial Companies Law.

“The company sustained considerable financial losses as a result of the unstable political and security situation in Bahrain,” Bahrain Air said in a statement. “In 2011, the airline was instructed to suspend flights to several destinations. It also suffered from the lack of traffic to and from Bahrain, and from the restrictions on the Saudi Causeway.”

The company received no compensation for the suspension of its operations.

Simultaneous requests to make immediate payments on past government debts and to reduce its ability to generate the necessary revenues both to make these payments and to sustain long-term profitability have effectively strangled the company, it said.

“The shareholders of the company have spared no effort to support the airline financially since its inception and to support the airline and Bahrain through the unrest in 2011. The airline has also spared no effort to negotiate a solution with the Minister of Transportation (who is also an active board member of Gulf Air). However, he has shown no inclination to provide a meaningful solution. His decisions to restrict route approvals have cost the airline 4.5 million Bahraini dinars in lost revenues over the last three months,” the company said.

Bahrain Air said that the minister, during negotiations, extended the company’s Air Operator’s Certificate (AOC), after operational audits had been passed, for only two months instead of one year.

“After meetings, the latest company proposal was forwarded on February 7. During the EGM, a very negative response was received providing only minor route concessions in return for payments of over 4 million dinars. In the circumstances, given the position of the minister, the shareholders decided that they had no option but to discontinue financial support and put the company into voluntary liquidation,” it said.

The company said that “today is a sad day for all Bahrain Air shareholders and employees, and for loyal guests and all those who valued the freedom of choice when making their travel plans.”




About the author

Born August 3, 1960 in Monastir, Tunisia
Media career:
  • ABC News (Tunisia)
  • Bahrain Tribune
  • Gulf News
  • Bahrain Television News
Teaching career:
  • Monastir (Tunisia)
  • University of Bahrain
  • MA  Mass Communications, University of Leicester
  • BA  in English & US literature and studies, University of Tunis

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