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Crossair Chief Forced Out In Swissair Restructure

by Ulrika Lomas, Tax-News.com, Brussels

10 December 2001


Prospects for the new Swissair/Crossair hybrid are supposedly better after the resignation of the entire board of Crossair AG on Thursday night. A new supervisory board was appointed led by Pieter Bouw, a former chief executive of KLM, the Dutch flag carrier, which will oversee the restructuring of the airline into a successor to Swissair as the national airline.

Conspicuously absent from the new board, which includes only two of the seven former directors, was Moritz Suter, who founded Crossair and commands wide support among the staff and customers of the airline, the largest regional carrier in Europe. Some 50,000 people signed petitions supporting Mr. Suter.

Mr Suter said he and the rest of the Crossair board had agreed to resign voluntarily to avoid endangering the future of the new airline: "What Crossair urgently needs now is calm and stability to enable it to focus fully on the key tasks at hand," he said. Mr Suter founded Crossair as an air taxi service with SFr65,000 ($39,000) capital in 1975.

Mr Suter, a former Swissair pilot, was regarded by his old employer as a buccaneering upstart who did not share the same culture as a 70-year-old intercontinental airline such as Swissair. Of course, now we understand, that's why Crossair is profitable and Swissair has gone bankrupt, and the surpassingly wise authorities are just making sure that the new airline will be as unprofitable as the last one.

Mr Suter, in an emotional speech before Crossair shareholders, made clear his unhappiness at being forced to give up the job he loved. He said there was "something wrong in our country" that was hurting "business creativity". He won a standing ovation from some 2,500 shareholders, whose collective stake is dwarfed by the 70% held by new owners including banks UBS AG and Credit Suisse Group.

Despite his early announcement of his resignation, small shareholders took to the stand to express their dismay at the way he had been effectively booted out. One shareholder went as far as banging with his shoes on the speaker rostrum, naming former Soviet Union leader Nikita Krutschev as his example.

The representative for the banks' shares, Swiss Re chairman Peter Forstmoser, chairman of Swiss Re and a member of the government-backed committee choosing the new directors, was roundly booed by the smaller shareholders during his speech. But in the end Mr. Forstmoser carried the day because of his overwhelming majority in votes.

Crossair, helped by a substantial injection of public and private sector funds, will more than double in size as a result of taking on 52 Swissair aircraft, and will have projected revenues of SFr3bn in 2002 compared with SFr1.2bn last year. It aims to break even in 2003 on revenues of SFr5bn. Don't hold your breath.


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