Thai Airways International plans to increase its stake in Nok Airlines to as much as 60% in order to exert more control over the low-cost carrier. The flag carrier previously said it would raise its stake in Nok to 49% from 39%, but THAI now wants to increase this to 59% or 60%.
Senior THAI executives said increasing the stake was an essential part of building co-operation between the two airlines, which would end in Nok assuming the bulk of the national carrier’s domestic services.
As many as nine of THAI’s 12 domestic routes are no longer economically viable for the flag carrier due to its high cost structure and intense competition from Thai AirAsia and other low-cost airlines.
THAI plans to finance the increased stake in Nok through its own capital and THAI’s provident fund and employees’ welfare fund, said THAI executives.