Privatisation Biman Bangladesh Airlines

1 privatisation

1.1 1980s
1.2 1990s
1.3 2000s
1.4 public limited company
1.5 2010s

privatisation
1980s

during late 1980s, hossain mohammad ershad, president of bangladesh @ time, served president of biman. after period of expansion , growth, biman entered era of nose-diving profits , slow growth, exacerbated incompetent , corrupt management, padded purchases, falsified repair bills, , kept unprofitable routes in operation political reasons. research conducted in 1996 found biman had 5,253 non-flying personnel, 30 percent more singapore airlines, carrier operated fleet ten times size of biman s. report described biman poorly managed, overstaffed, undercapitalized, , subject excessive political interference in day-to-day management.

1990s

biman bangladesh airlines f28-4000 fellowship @ bangkok-don mueang airport in 1995. biman received first aircraft of type in 1981.

in 1992–93 fiscal year, accounts under ministry of civil aviation , tourism revealed bdt 22 million in tax not paid government. audit carried out in 1999, showed biman owed bdt 2.2 million travel agents proceeds of ticket sales, collusion of biman officials. additionally, bdt 2.4 million overpaid incentive commissions sales agents in violation of biman policies. in 2007, caretaker government launched anti-corruption drive. shortly followed forced retirement of 35 other employees , officials, of whom close aides of shamim iskander. in 2008 iskander, younger brother of former premier khaleda zia, sent jail on charges of concealing information regarding wealth , not connection biman.

faced growing losses late 1990s onwards, government offered 40 percent of biman foreign airlines in 2004, hoping buyer take on management of carrier. however, proposal demanded many decision-making rights remain within bangladesh government, , offer ignored outside airlines. similar initiative in 1998 cost biman $1.6 million in consultancy fees no positive results.

2000s

in 2005–06 fiscal year, biman carried 1.15 million passengers, growth of 70% on previous decade. rise of private domestic carriers in bangladesh, however, biman s market share domestic passengers dropped 35% on previous ten years average, 162,000 passengers travelling biman in domestic sector in 2005–06 fiscal year. during same period, biman reported biggest annual loss of on us$120 million (bdt 8.3 billion of 2010), us$100 million (bdt 6.9 billion of 2010) loss reported following year. biman fell behind on millions of dollars in payments fuel supplier, bangladesh petroleum corporation (bpc), debts rose bdt 15.64 billion in late december 2006 (2006-12).

public limited company

in may 2007 (2007-05), caretaker government approved plans turn biman public limited company shareholdings split between 7 public sector organisations. part of restructuring, government put in place voluntary retirement scheme (vrs) reduce man-equipment ratio (mer) of 367:1 (ratio of manpower aircraft). industry average @ time 200:1, , other asian airlines operated mers of 150:1. vrs provided compensation based on length of service, @ cost government of on bdt 2.97 billion borrowed world bank. biman management expected reduce workforce 1,600, 2,162 applications received, many employees expected dismissed little or no severance pay if quota not met. biman accepted between 1,863 , 1877 applications, , affirmed key personnel not allowed leave organisation via vrs.

on 23 july 2007, biman bangladesh airlines became largest public limited company in bangladesh. earlier suggestions airline should renamed bangladesh airlines rejected. government sole shareholder of 1.5 billion shares, intends offer 49 percent private sector while retaining majority ownership. previous managing director, dr. abdul momen, appointed chief executive officer (ceo) , managing director of new organisation. 6 directors appointed ministries of energy, commerce, finance, civil aviation, foreign affairs, , cabinet division, cabinet secretary taking on role chairman of board of directors. 6 secretaries , joint secretary civil aviation ministry made 7 shareholders of new plc. in september 2008 (2008-09), government appointed air commodore zahed kuddus (retd) replace dr. momen ceo. 2002 2005 kuddus had been chair of civil aviation authority of bangladesh (caab), before had held various posts in bangladesh air force.

following privatisation, initiative launched ex-biman employees, left organisation via vrs, set competing airline. names proposed airline included air bangla international, biman employees airlines , balaka. joined previous managing directors of biman, along former president of bangladesh airline pilots association. however, nothing further heard of regarding proposed venture.

the airline made profits in fy 2007–08 (bdt 60 million) , fy 2008–09 (bdt 150 million); in fy 2009–10, however, carrier incurred in net loss of bdt 800 million.

2010s

in fy 2010–11 made losses of bdt 2 billion, despite government exempting debt of bdt 11.94 billion , bdt 5.73 billion owed bpc , caab, respectively. in fy 2011–12 made loss of bdt 6.06 billion (us$75 million); in fy 2012–13 unaudited figures show loss of bdt 2 billion. airline plans profitable fy 2014–15. of december 2013, biman owed bdt 15.60 billion different sources; of bdt 3676.2 million caab , bdt 8.50 billion padma oil company, fuel supplier. biman made profit of bdt 2.72 billion in fy 2014–15.