Sri Lanka's Minister for Public Enterprise Development, Kabir Hashim, has confirmed government is in talks with three undisclosed airlines concerning a strategic management partnership for SriLankan Airlines (UL, Colombo International).

The Sri Lankan government appointed a three-man interministerial committee composed of Minister of Public Enterprise Development, Kabir Hashim, Minister of Development Strategies & International Trade, Malik Samarawickrama, and Minister for Special Assignments, Sarath Amunugama, to oversee the process of finding a partner for the carrier after a Request For Proposals (RFP) issued last year failed to produce a suitable commitment. It is recalled that RfP's preferred bidder, US-based investment firm Texas Pacific Group (TPG), withdrew from the process in May this year citing the Sri Lankan airline's difficult financial position.

“In the next few days there will be a few parties talking to the committee. We will begin to negotiate with a few people and see how it goes,” Hashim told the Daily Mirror newspaper.

While the search continues, Hashim says the cabinet will present a restructuring programme to Prime Minister Ranil Wickremesinghe at the end of this month aimed at stopping SriLankan Airlines' soaring annual losses.

“By 31st of July, we have to give an internal restructuring plan to the Prime Minister, basically looking at what we have to do internally with SriLankan," he said. "Irrespective of whether we are getting a partner or not, we need to move forward."

The airline's board has already devised the plan and it includes details of how cost reductions will be achieved through capacity rationalization both in terms of fleet reduction as well as seat reconfigurations.

SriLankan’s operational losses widened to LKR28.14 billion Sri Lankan rupees (USD182.9 million) in 2016 from LKR12.62 billion (USD82 million) in 2015 although this has been attributed to its absorption of loss-making low-fare airline, Mihin Lanka (Colombo International). SriLankan's operational losses for the first four months of 2017 are said to stand at LKR9.52 billion (USD61.9 million).