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COLOMBO : Dubai's Emirates Airlines said on Sunday it would stop sharing routes with Sri Lanka's national carrier when its decade-long management contract expires this month.
"Code share arrangements between Emirates and SriLankan Airlines will cease from 31st March 2008 with the expiry of the management agreement," Emirates said in a statement.
The decision follows worsening relations between Emirates Airlines and Colombo, with talks between both sides collapsing after nearly two years of negotiations over renewing the contract.
In December, the government withdrew the work permit of the Emirates-appointed chief executive of SriLankan Airlines, Peter Hill, because he failed to "look after the interests of the majority shareholder."
However, the Dubai-based carrier said it will retain its near 44 percent stake and continue to have a board presence.
Emirates president Tim Clarke had told AFP in January that it was willing to sell all or part of its equity stake, valuing the 43.6 percent parcel at 150 million dollars.
Emirates will continue to serve Sri Lanka with 17 weekly flights to Colombo, connecting the country's travellers to 100 global destinations via Dubai. The flights will be operated using Emirates' aircraft, the statement said on Sunday.
In response, SriLankan Airlines said it was working to develop new destinations and tourist markets to add to its current schedule of 54 destinations in 28 countries.
Starting April, the government, which controls 51.05 percent of SriLankan Airlines, will manage the flag carrier, the statement said but did not give details of what would happen if they plan to buyout Emirates' stake. - AFP/de
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