Mihin Lanka, SriLankan Airlines to be merged

Colombo-based Mihin Lanka and its sister carrier, Sri Lankan Airlines are to be merged into a single entity as part of the new Sri Lankan government’s plans to cut down on unnecessary expenditure.


Mihin Lanka SriLankan Airlines to be merged


Colombo-based Mihin Lanka and its sister carrier, Sri Lankan Airlines are to be merged into a single entity as part of the new Sri Lankan government’s plans to cut down on unnecessary expenditure.

Presenting the country’s interim budget late last week, Finance Minister Ravi Karunanayake said consolidating the two carriers into one company would cut losses while increasing productivity. Mihin, a state-backed budget carrier operating flights to the Indian Sub-continent, the Middle East, and South East Asia, has racked up LKR15 billion (US$113.4 million) in losses since 2010 while its full service counterpart, Sri Lankan, has lost LKR100 billion (US$755.8 million) over the same period, he said.

Both carriers have blamed their dismal financial performance on “high fuel costs, less than satisfactory yields due to the recession in Europe, competition from other airlines, significant investments in acquiring additional capacity and enhancement of supporting services including the cabin upgrades.”