$5.7million not enough, says P.M.
Prime Minister Tuilaepa Sa’ilele Malielegaoi has downplayed a dividend payment of $5.7million to be made by Virgin Samoa to the government, saying it wasn’t enough.
Speaking to the media, Tuilaepa also confirmed that the joint venture between government, Virgin Australia and the Grey Investment Group has been extended for another six months.
Tuilaepa said the time is to allow negotiations to continue about the future of the joint venture.
Asked about the Airline’s dividend, Tuilaepa was not impressed.
“The money they gave is not enough (dividend),” he said.
“It’s been two years and it’s been a while since the last dividend.” The dividend, to be presented this week, was revealed in a letter obtained by the Samoa Observer.
Written by the Chief Financial Officer of Virgin Australia, Geoff Smith, and dated 30th November 2016, it reads: “The Board resolved on 27 October 2016 to pay AUD3,000,000 dividend on 30 November 2016,” a copy of the letter reads.
“In accordance with Section 64 of the Samoan Companies Act, after consideration of the financial position of the Company, it can be concluded that at the date of payment;
• the Company’s assets exceeds its liabilities and the excess is sufficient for the payment of the dividend
• the payment of the dividend is fair and reasonable to the Company’s Shareholders as a whole, and
• the payment of the dividend does not materially prejudice the Company’s ability to pay its debts as they become due in the normal course of business”
The letter was addressed to the Chairman and Board members of Virgin Samoa Limited.Among them are Jane Mckeon, Phil Squires of Virgin Australia, TupaimatunaIulaiLavea, C.E.O Ministry of Finance,former Attorney General, Aumua Ming Leung Wai and Lupesina Frederick Grey of the Grey Investment Group (G.I.G).
Virgin Samoa, formerly Polynesian Blue, flies between Samoa, Australia and New Zealand. It is owned by Virgin Australia Holdings (49%) and the Government of Samoa (49%) with the remaining percentage owned by G.I.G.
In 2005 Virgin Blue Holdings signed an agreement with the government of Samoa to operate the joint venture airline. Its first flight was on 31 October 2005, between Apia, Auckland and Sydney.
Polynesian Blue was rebranded Virgin Samoa in 2011 and a new livery was unveiled for one of the Boeing 737-800s operated by Virgin Australia.
At the beginning of the year, a Cabinet press statement said Samoa’s deliberations and preparations for a new agreement is on-going and is also eyeing new agreements with other airlines.
The Samoan government has been openly unhappy with the joint venture after Virgin Airlines went into partnership with Air New Zealand.
When the Minister of Works, Transport and Infrastructure (M.W.T.I) was asked for a comment recently, Papali’itele was coy about the state of the review.
“There are some problems with the joint venture that we have now with Virgin Australia,” he said.
“We’ve noticed that a lot of benefits are not coming straight to us.
“So that’s why our government is now looking at finding our own airline.
“We now have a committee working on finding us a new airline to carry our flag.
“There is a great need to have our own airline. The main problem we now have with our joint venture is the money coming in. That’s why we are now looking at getting our own airline.”
Polynesian Airlines has recently announced plans to revive its international flights operations.