Prime Minister Questions Valuation in LIAT 2020 Deal
Prime Minister Gaston Browne has voiced serious concerns about the valuation methodology used in the LIAT 2020 partnership between Air Peace and the Government of Antigua and Barbuda.
He suggested that Antigua and Barbuda might ultimately hold a majority stake in the restructured airline.
Currently, the valuation assigns Air Peace Caribbean a 70 percent ownership stake, leaving the government with 30 percent. Browne, however, contends that the valuation overestimates Air Peace’s contributions, specifically the two aircraft provided.
“The planes are probably worth about $5 million each,” Browne said, “but the valuation team valued them based on projected cash flows for ten years down the road, inflating their worth far beyond market value. I told them, ‘What kind of madness is that? Value the assets at market price—if it’s $5 million, then it’s $5 million.’”
Browne also highlighted the old Goddard building at the airport, which the government allocated to LIAT2020 for operational use, as a significant asset that he believes holds more value than the Air Peace planes.
“We’ve provided a building for LIAT that alone likely holds a higher market value than the two planes Air Peace has put in so far,” he stated.
The Prime Minister also voiced his concerns over the leasehold values in the new LIAT entity, emphasizing the need for tangible ownership.
“So if LIAT 2020 doesn’t own assets, what happens if things go bad? What happens to the staff and the airline’s future? We can’t leave them with nothing,” he added, stressing that proper valuation would protect LIAT 2020 employees and the government’s stake.
In addressing the risk associated with land contributions, Browne noted, “They told me that by putting land on a freehold basis, we may lose it. I said, ‘Are you going to protect the government and expose the staff?’”
He insisted on market-based revaluation, expressing confidence that it would ultimately place Antigua and Barbuda in the position of majority ownership.
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I just have 1 question PM Browne.
What happen to the LIAT(1974) former employees? Air Peace was just taking a page from your book.
What happened passenger refund buy ticket never fly again