Cyprus Airways (CY) officially announced on Monday the sale of its remaining time-slot at London’s Heathrow Airport, ‘Cyprus Mail’ reports.
In a statement, CY said it has concluded a deal to sell the slot to American Airlines for US $31m (€22.9m). The slot serviced flight CY346/CY347.
CY said the sale of the time-slot had been part of the airline’s restructuring plan.
The deal was finalised and ink was put on paper on Monday, CY chairman Tony Antoniou told the ‘Cyprus Mail’. The agreement secures a significant revenue stream that would boost the company’s liquidity through 2015, CY said in a press release.
The move is ideally timed, as the time-slot’s value would plummet if the European Commission were to disapprove the airline’s restructuring plan submitted to it, CY said.
The EC is set to rule by the end of this year on whether capital injections from the government to the airline constitute state aid, forbidden by EU competition rules.
Moreover, possession of the slot would automatically return to Heathrow airport authorities should the EU rule negatively on the plan.
The sale will help improve the financial viability of the Larnaca to London route, which currently operates at a loss, CY noted.
The deal paves the way for the airline to transfer its route to another London airport, with more frequent flights and at more convenient times, it added.
CY said that Stansted airport would be its new London destination with the route opening up from 14th September. Until then CY flights will continue to run to and from Heathrow as usual.
The company said it would be notifying passengers who have booked flights to London for after 13th September.
Rumours of the sale of the slot to American airlines has been about for days. It is said that the Greek Cypriot ministry of finance has approved the move.