The eight directors of national carrier Cyprus Airways appointed by the state have placed their resignations at the disposal of the Finance Ministry to facilitate efforts to rescue the embattled airline.
The eight include executive chairman George Mavrocostas. The move came at the end of an extraordinary meeting of the board on Friday afternoon to discuss the decision of the House of Representatives the previous day granting the airline a lifeline — but on condition government appointed board members step down. The state is the majority shareholder in the airline which has been struggling to stay in the air in the wake of tough competition.
On Thursday deputies by majority approved an increase in the company’s share capital by €45m, of which €31.5m is to come from the government. But the tough conditions stipulate that the cash is on hold until the eight are replaced by new directors approved by both the Finance Ministry and the House Finance Committee. This would lead to the first €15m being released, with the rest due once a new restructuring plan is approved within three months.
CA trade unions and ruling Akel party have slammed the conditions, though the pilots welcomed the move.
In a statement issued after the board meeting, the directors said they were satisfied with the work achieved under very difficult conditions. They said their main concern was the good of the airline above else, adding that the inclusion of an open skies policy– allowing all companies to execute flights to third countries — in the bill that was approved on Thursday would serve as a coup de grace for the national carrier which is already struggling because of increased competition from low cost airlines that have benefitted from state incentives.
They said that it also undermined efforts to secure a strategic investor and would discourage private investors from participation in the new share issue.
Releasing the money in installments only increased the sense of uncertainty, they added.

Cyprus Weekly