August 4, 2019 06:45 AM NPT
KATHMANDU, Aug 4: Nepal Airlines Corporation (NAC) is planning to conduct a due diligence audit (DDA), for which it has called proposals from interested consultants.
The state-owned carrier has called request for proposal (RFP) from interested consultants to assess the value of the corporation. The deadline for the submission of RFP is August 29.
“We have called out for bids to carry out the auditing of the corporation,” said Ganesh Bahadur Chand, spokesperson at the NAC. “The consultant handed with the responsibility should complete the DDA within 90 days from the issuance of the task.”
The consultancy will conduct a detailed and comprehensive examination of the NAC’s financial and other related information with a view to assessing its condition and determine the potential business and various risks associated. The consultancy is also required to carry out the market valuation of its assets and liabilities. Chand said that the audit will show the present situation of the NAC.
The auditor is expected to perform accounting and financial DDA including evaluation of the NAC to compute enterprise valuation to determine business value of the shares of the NAC. The business value will depict minimum value of the NAC’s shares as the ‘minimum base price’ to be considered for capital restructuring, according to a notice issued by the NAC.
In response to the NAC’s request to provide a bailout of Rs 20 billion, Prime Minister KP Oli at the 61st-anniversary function of the NAC on July 1, had said that the government was not going to make more investment in the crisis-ridden airline company until it improves its performance. He had also suggested the airline to bring in a strategic partner. The government in December had said that it was prepared to sell a 51 percent stake of the NAC. DDA is usually carried out to identify potential investment opportunities before entering into a merger with a new partner. Airlines like Turkish Airlines, Ethiopian Airlines, flydubai, and Qatar Airways are potential investors in the airline.
The NAC has failed to make profits being unable to operate long-haul flights of wide-body aircraft. The company has incurred total losses of Rs 37 billion.
NAC TO FLY TWO CHARTERED FLIGHTS TO NARITA
The NAC will fly two chartered flights to Narita International Airport in Japan, another destination
the national flag carrier has been eying.
The first flight will take off from Kathmandu on September 26 and return the next day. Similarly, the second flight to Narita will is scheduled on October 2 that will also return the next day.
Issuing a press statement, the company said that it will take 14 hours and 30 minutes for the Kathmandu-Narita-Kathmandu flight. The NAC’s wide body aircraft, Airbus A330-200, will be used for the flights. NAC Spokesperson Ganesh Bahadur Chand said: “The NAC is positive about the chartered flights to Narita and looks forward to similar progress in the future.”
The airline is launching its scheduled flight to Osaka from August 29 with promotional airfare. The passengers can book the direct flight for Rs 36,900 for one way and Rs 72,814 for round trip.
The NAC had earlier announced to start Osaka flights from July 5. However, it postponed the maiden flight to August 29, citing poor bookings.
The NAC will operate Osaka flights three times a week -- on Tuesdays, Thursdays and Saturdays. The flight will take off from Kathmandu at 2:30 am and land at Osaka at 11:55 am (local time).