Caribbean Airlines will take over operations of Air Jamaica on Saturday, May 1. Beginning on that day, a transition plan will be implemented under which Air Jamaica will continue its current operations under a contractual arrangement with Caribbean Airlines. “There will be no disruption of service, as all tickets previously issued to the passengers will be honored,” said Dennis Lalor, Air Jamaica’s chairman.
Earlier this week, the Cabinet of the government of Jamaica approved the terms of an Agreement for the Divestment of the operations of Air Jamaica to Caribbean Airlines, effective Friday, April 30. As of Saturday, Caribbean Airlines will assume full financial responsibility for Air Jamaica. The government will transfer Air Jamaica’s routes to Caribbean Airlines in exchange for a 16 percent ownership in Caribbean Airlines. However, the government of Jamaica will remain the owner of all of Air Jamaica’s other assets, including its real estate and industrial assets.
After a period of 6 to 12 months, Caribbean Airlines will fully enforce its plan to provide sustainable airlift to/from Jamaica. Those plans call for the initial operations to continue serving routes from JFK to Montego Bay, JFK to Kingston, Baltimore to Montego Bay, Philadelphia to Montego Bay, Toronto to Kingston, Fort Lauderdale to Montego Bay, and Fort Lauderdale to Kingston. Any changes to that schedule would be announced by Caribbean Airlines.
“Under these terms,” Lalor said, “the deal is, financially speaking, superior to the initial bid submitted by Caribbean Airlines and superior to the transaction which was contemplated with the other bidder, Indigo Partners.” He added that, in order to ensure the long-term sustainability of its new Jamaican network, Caribbean Airline must operate a streamlined operation. “As it has already been announced, all Air Jamaica employee positions will be made redundant on April 30, 2010,” Lalor said. “Approximately 1,000 of them will be re-hired by Caribbean Airlines during the transition period. These employees have already been identified and have been given the opportunity to work with Caribbean Airlines.”
Lalor said that he believes that this transaction “creates a unique, historic opportunity to create a true Caribbean air carrier, leveraging the expertise and strengths built up by Air Jamaica and Caribbean Airlines and to be able to compete in a fierce global market environment.” For more information, visit www.caribbean-airlines.com.