Croatia Airlines Face Bankruptcy Because of French Airbus Deal

Croatia’s national carrier, Croatia Airlines, faces bankruptcy unless it can change terms of a contract that was signed in 2008 by former Prime Minister Ivo Sanader, reports Globus magazine.

Sanader, who is currently before the courts on corruption charges, struck up a deal with former French President Francois Sarkozy, to buy four planes back in 2008 with Airbus France and now the time has come to pay.

Croatia Airlines director Kresimir Kucko is off to France to meet with Airbus bosses where will try to explain why Croatia Airlines can not purchase four new Airbus A319’s, which was agreed upon back in 2008.

According to the current contract, Croatia Airlines must tie up the financial part of the deal by 1 January 2013. Globus reports that if Croatia Airlines fulfills the contract and purchases the four new planes, they will face bankruptcy. The deal in the contract with Airbus is reported to be worth 175 million USD. If Croatia Airlines dishonors its contract with Airbus, it will cost the company, at minimum, close to 6 million euros in damages.