Bahrain’s sovereign fund Mumtalakat is looking for acquisition opportunities in the aviation sector, its chief executive has said.

Mahmood Al Kooheji also told the Gulf Daily News (GDN), our sister publication, that Falcon Holding, a proposed new company consolidating key aviation assets of the Bahrain government, would implement the fund’s plans for the sector that include enhancing the contribution of aviation to the economy and maximising the value of assets.

“The plan is to help the aviation assets operate in an independent, commercial and efficient manner, and look for new opportunities in the aviation sector, which would add value in the business and ultimately reflect on Mumtalakat’s portfolio and the economy of Bahrain,” he said.

Mumtalakat will continue to be the 100 per cent owner of the assets – Gulf Air, Bahrain Airport Company and Gulf Aviation Academy – and provide “strategic guidance and support”.

“Post consolidation, the companies would continue to operate as independent entities with one board of directors which would guide the operations under one strategy,” the chief executive said.

“This will facilitate a unified vision for Bahrain’s aviation ecosystem and ensure more efficient and co-ordinated decision making at various entities.”

Al Kooheji said as the holding company implements the unified board strategy, significant synergies are expected to be realised through the 
consolidation process.

“The synergies include but are not limited to efficiency improvements across a plethora of shared-services functions, strategic sourcing and strategic planning.”

He said as Bahrain was an island, it was critical for the country to have good air connectivity to key markets in the region and globally in order to serve the economic growth of the kingdom.

Hospitality industry sources told the GDN that Gulf Air, which currently flies to 45 cities in 24 countries, is set to add more routes and increase frequencies in response to rising demand.

Following a major restructuring exercise launched in early 2013, the flag carrier cut a number of loss-making routes and reduced services.

A GDN report quoted Transportation and Telecommunications Minister Kamal Ahmed telling MPs in February that Gulf Air’s losses this year are expected to be less than a quarter of what they were three years ago.

The airline, which accounts for more than 60 per cent of Bahrain’s air traffic contributed around 8pc of the country’s GDP last year.

Bahrain Airport Company (BAC), the other major asset of Falcon Holding, is the manager and operator of Bahrain International Airport, where a $1 billion expansion is ongoing.

A new terminal, expected to be four times the size of the existing terminal, is planned to be completed by 2019.

It will accommodate 14 million passengers a year.

The airport saw 10pc growth in passenger traffic last year and is expecting about 8.7 million passengers by the year-end, BAC chief executive Mohamed Al Binfalah has said.

BAC’s focus is on new, unserved markets and tapping into countries such as Bangladesh, Nepal, Malaysia, Indonesia and China, which are not currently being served by BIA, and which hold great potential for high-growth yields.

It is also looking to increase frequencies to under-served markets such as India, Pakistan, Philippines and Sri Lanka where it sees demand soaring. - TradeArabia News Service