Tonga's prime minister, ʻAisake Eke, has confirmed that two companies, including dormant carrier Fly Niu Airlines (Tongatapu), have expressed interest in acquiring Lulutai Airlines (L8, Tongatapu). The government has been seeking to offload and privatise the financially troubled national carrier, with a decision initially expected in July but since delayed.
Fly Niu Airlines is an idle Tongan carrier that briefly operated in 2004 before being shut down under the government's one-airline policy. The airline has been pursuing a relaunch for several years.
As reported by ch-aviation, Fly Niu Airlines first signalled interest in acquiring Lulutai Airlines in 2021, with the government agreeing in principle at that time. The airline renewed its proposal in 2024, offering to provide Lulutai Airlines with an aircraft under a wet-lease arrangement, management services, and a share acquisition within twelve months.
Eke did not identify the second company interested in the privatisation, although New Zealand's Sunair Aviation (Tauranga) had previously been linked to the process. Lulutai Airlines was reportedly in early-stage discussions with the airline in June.
One factor critical to the sale is Lulutai Airlines' outstanding TOP6 million pa'anga (USD2.5 million) loan from the government's retirement fund. The financing was used to acquire a DHC-6-400 for the airline, which has long struggled with a shortage of aircraft.
Concerns have been raised about the airline's capacity to service its debt if a sale does not materialise. However, the government has assured that the loan is secured by a state guarantee. Lulutai Airlines reportedly has so far repaid TOP800,000 (USD332,000), leaving a balance of TOP5.7 million (USD2.4 million) including principal and interest.
Lulutai Airlines currently operates one DHC-6-400 and one Y12, and has an inactive Saab 340B(Plus). It is also damp-leasing a Saab 340B from Air Chathams.
