KUWAIT - Kuwait has suspended the chairman of state-owned Kuwait Airways KA.UL in a dispute over his plans to buy five used aircraft from India's Jet Airways (JET.NS), which the company has since abandoned.
Kuwaiti newspaper al-Qabas quoted the Communications Minister Esa al-Kandari as saying he had suspended Sami al-Nisf after he announced plans to buy the used aircraft despite a government request to stop the deal. It said Nisf's deputy, Jassar al-Jassar, has been appointed as acting chairman.
Nisf confirmed on Monday that he had been suspended.
The plan to buy the used Airbus A330 planes was announced on Sunday, with the company adding that it would not affect a previous deal to buy new Airbus jets.
Nisf had said that Airbus, owned by aerospace and defence group EADS (EAD.PA), would act as a mediator in the deal with Jet Airways, even though the five-year-old planes are owned by the Indian carrier.
In a meeting after Nisf's suspension, Kuwait Airways decided to abandon the plans to buy the used aircraft, it said in a statement on Monday, adding that it would discuss any deal to lease or buy aircraft at a later meeting.
A company source said Kuwait Airways had been negotiating to lease the Jet Airways aircraft for eight years in a deal worth 134 million dinars but decided instead to buy the planes for 77 million dinars.
In a statement to Reuters on Monday a Jet Airways spokesman said no deal had been reached.
"No such decisions have been taken to sell planes to other carriers," the statement said.