Mozambique plans SPV for $130m state airline bailout

Mozambique is creating a special-purpose vehicle for a group of state-owned companies to acquire shares in the national airline LAM, the cabinet said in a statement.

The new entity will be owned by Hidroeléctrica de Cahora Bassa, the state-owned hydropower company, railway company Caminhos De Ferros de Moçambique, and insurance company Empresa Moçambicana de Seguros.

The government in February announced plans for them to acquire 91% of the loss-making airline. At the time, the cabinet said the $130 million cost for the stake would be used to purchase eight new aircraft and restructure the airline.

The government in May appointed former Air Serbia CEO Dane Kondic to lead LAM’s restructuring. The company has struggled to stabilize costs and service its debts. In 2023, it hired South Africa-based Fly Modern Ark to improve its finances but terminated the contract in 2024.

In a fiscal risk report for 2026 published last week, the finance ministry classified LAM as a “high-risk” company, whose operations “require direct intervention from the state.”

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