Worldcrunch NEWSBITES*

MOSCOW - Avianova, a Russian low-cost airline that began operations in 2009 and has been teetering on the brink of bankruptcy has announced that it will discontinue all flights as of October 9. The company, which was the second low-cost airline to enter the Russian market in 2009, was a joint venture between a Russian investment company, A1, which controls 51% of the stock, and an American company, Indigo Partners, with 49%.

Avianova threatened to stop all service on Monday night due to high debts owed to its service partners, but agreed to extend service for a week after negotiations with Russian aviation authorities. According to the majority stockholder, extending service for an additional week will cost two million dollars, and compensation for those who had booked tickets for flights after October 9, around 63,000 tickets, will cost an additional five million dollars.

Passengers were advised to turn in their tickets for flights after October 9, through the company's website. At the ticket counters at Avianova's two hubs, Moscow Sheremetyevo and Krasnodar, there was no further information available. On Monday, however, the company's planes arrived at Sheremetyevo with an average delay of 3 to 4 hours, and one morning flight was cancelled. In fact, flight delays are one of the issues that have plagued the company from the beginning.

An independent consultant, Boris Ribak, noted that Avianova was a risky venture from the start, and particularly questioned their choice of Andrew Pain to lead the company, since he had already led a low-cost airline, Air Macau, backed by the same two investors, that wound up going bankrupt as well.

Read the full article by Yekaterina Sobol in Russian

*Newsbites are digest items, not direct translations

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