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Source:- http://archive.gulfnews.com/articles.../10130276.html
Emirates may renew management contract with Sri Lankan Airlines
By Ivan Gale, Staff Reporter
Vancouver: Emirates airline will likely renew its management role with SriLankan Airlines, a top Emirates official said, after months of the deal appearing to be in limbo.
"The issue is under discussion with the Sri Lankan government, and it looks likely the contract will be extended," said Maurice Flanagan, Emirates vice-chairman and group president, during an aviation conference in Vancouver on Monday.
Emirates owns a 43 per cent stake in Sri Lanka's national carrier and also manages the airline under a 10-year contract, which expires in March 2008. The Colombo-based airline is majority owned by the Sri Lankan government. This week, the airline announced that its net profit last year was Dh67 million ($19 million), an increase of 48 per cent from the Dh45.6 million ($12 million) it reaped in 2005.
Emirates, the eighth largest carrier by international traffic, often fuels speculation that it will acquire foreign carriers, but its partial ownership in SriLankan has been its only foreign investment.
Until last month, the Sri Lankan government had not sat down to discuss the contract renewal with Emirates, effectively preventing the airline from formulating a long-term plan.
In February, a SriLankan official told Gulf News the airline would like to grow from a fleet of 14 aircraft to 25, "but nobody can go ahead until the government of Sri Lanka gives the green light for Emirates to continue with management".
The tenor of the talks last month between the government and Emirates was "warm", Flanagan said.
While not directly involved in the talks, Flanagan said he expected the matter to take another three to four months to finalise.