Estonia’s Ministry of Climate, which oversees the operations of Nordica (ND, Tallinn Lennart Meri), is in contact with seven potential suitors, all of which are European companies, over the full or partial sale of the loss-making state-owned flag carrier and aims to reach a preliminary agreement with at least one of them this month, the Estonian public broadcaster ERR reported.

The lessor Transpordi Varahaldus, also a subsidiary of Nordic Aviation Group, is not currently part of the agreement and will be sold later, but sister carrier and ACMI specialist Xfly (Estonia) (EE, Tallinn Lennart Meri) is ready for sale with or without Nordica.

“Initial materials were sent out to the interested parties before Christmas, and we’ll be awaiting more detailed feedback in the first weeks of January,” said Sander Salmu, undersecretary for mobility and transport at the ministry. “The process has become a bit more formal.”

The Estonian government met interested parties in November and December, and the Baltic financial advisory firm assisting with the sale, Superia, has since dispatched further information to seven possible suitors. If one or more entities are interested in buying Nordica, the ministry will follow up with additional and more precise financial data on signing a confidentiality agreement.

“We’ve started with those who are active in Europe and are familiar with the field - so that we wouldn’t have to start explaining from scratch, so to speak, what Europe is and how aviation works here,” Salmu added.

He confirmed that the state has no intention of putting any more taxpayers’ money towards the airline. Once it is sold, additional capitalisation will be up to the new owner. If it remains unsold, “we cannot rule out the difficult decision to shut down the company.”

The planned privatisation follows a damning evaluation in September of the state’s ownership of Nordica, Xfly, and Transpordi Varahaldus from Estonia’s state auditor, which concluded “it would be reasonable to sell” them. Nordica is still undergoing a special audit that is expected to reveal more of what went wrong with the airline. Based on that, it is possible that the government could submit claims against the previous management, Salmu said.

According to the ch-aviation fleets module, Nordica operates a single leased A320-200, while Xfly operates nine CRJ900ERs, seven of which are leased and two owned, and nine leased ATR72-600s.