Swissport - Ukrainian International Airlines dispute continues

Ground handler Swissport International has suffered another setback in its attempt to reclaim control of Ukrainian handling firm Interavia (previously Swissport Ukraine). Ukraine’s Highest Economic Court recently postponed Swissport's appeal for the seventh time.

The dispute stems from a previous partnership between Ukrainian International Airlines and Swissport, which was established in March 2006 with the aim of improving passenger handling in the Ukraine. The two companies became joint owners of Interavia, whose name was changed to Swissport Ukraine, and has since reverted back.

Swissport claims that conflict arose from its desire to invest further in the company to be able to cope with the double-digit growth. When UIA declined, Swissport suggested it put up the full investment amount and dilute UIA’s shareholding in exchange. UIA responding by taking Swissport to court, claiming that they were attempting to deprive UIA of participating in the management of the common business by trying to dilute the share.

The court ruled in UIA’s favour, and, after six separate hearings, ruled that Swissport must sell its 70% of Swissport Ukraine to UIA for $433,000 in March. The business was estimated to be worth $25 to $30 million, meaning Swissport suffered a $17 to $20 million loss.

Swissport have since questioned the legality of the move, and many industry representatives have agreed that the events constituted a hostile raider. Of the latest delay, Swissport commented; “The Ukranian government and Anti-Raider-Commission are long in coming with their promised support for foreign investors and companies […] Swissport is very concerned about the obvious delay tactics of the Highest Economic Court in Ukraine”.