Maputo, 5 Feb (AIM) – The government has authorized three companies from the state business sector to buy 91 per cent of the shares of the publicly-owned Mozambique Airlines (LAM).
The companies authorised to buy the shares are Hidroelectrica de Cahora Bassa (HCB), the company that operates the Cahora Bassa dam on the Zambezi River, in the western Mozambican province of Tete; the country’s Ports and Rail Company (CFM) and EMOSE, the country’s largest insurance company. These are the only three publicly owned companies that consistently run at a profit.
According to the government spokesperson, the Minister of State Administration, Inocêncio Impissa, who was speaking on Tuesday, in Maputo, after a meeting of the Council of Ministers (Cabinet), with the amount raised from the sale of LAM shares, estimated at 130 million dollars, the government intends to buy eight new aircraft and invest in restructuring the company, which is considered bankrupt.
“In fact, this is an indirect form of management of this company and what is planned is for these companies to use the management rules of international companies. In this way, we believe that the shareholders will not only be able to have greater control over the money they spend, but also use rules that will allow them to follow the normal life of the company”, he said.
Impissa explained that the three companies, being state-owned, have a duty to provide information to the government in order to understand the extent to which their business sector is achieving “the results we want as a country.”
Over the last 10 years, LAM has been shaken by a financial crisis involving corruption practiced by the company workers during the acquisition of services. The company has recorded debts with suppliers, valued at over 230 million dollars as a result of embezzlement.
Over the last year, LAM was under the management of the South African company Fly Modern Ark (FMA), which was hired by the government to bring the company into profitability and rescue it from bankruptcy.
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