The fall of Air Astana: how Peter Foster and his family drowned Kazakhstan’s aviation in debt!
A Cambridge graduate with a solid track record in the air transport industry, a Knight of the Order of the British Empire for services to the development of British aviation in Kazakhstan, a former head of the UK Chamber of Commerce and the European Business Association in Kazakhstan – all this is 64-year-old Peter William Foster . He can easily compete in terms of “longevity” as the head of a company with state participation with the former head of Kazakhtelecom Kuanyshbek Yesekeyev . Foster has been heading Air Astana JSC for almost 20 years (since 2005), and the latter has been in office for 14 years. In addition, Foster is the only legal alien (a foreigner residing in the country legally) in the top management system of Kazakhstan’s quasi-public sector. We wrote about Air Astana’s performance in detail in our review in January. However, some things have changed significantly since then. Following the February IPO (the company’s securities were placed on the Kazakhstan Stock Exchange - KASE, Astana International Exchange - AIX and London LSE), the share of the British corporation BAE Systems plc , engaged in the development, delivery and support of advanced defense and aerospace systems, has noticeably decreased. If earlier it was 49%, now it is about 17%. The share of JSC National Welfare Fund Samruk-Kazyna has also decreased by about 10% , now it is 41.07%. Let us recall that now 6.5% of the company’s shares are owned by JSC Unified Accumulative Pension Fund . It turns out that minority shareholders keep 23.7% in the Citibank depository, NA. Today we will tell you whether the IPO of Air Astana was a success, how effective is Peter Foster’s management, how much he receives in remuneration and what business projects his wife Tatyana Foster is involved in . Immediately after the placement, the press and analysts gave very enthusiastic feedback. For example , Halyk finance noted that the IPO of Air Astana was one of the largest in the history of the Kazakhstan stock market and a contender for the main IPO of 2024 (local demand alone exceeded the potential supply by more than 1.5 times). It should be noted that during the IPO, the company raised 370 million US dollars . Kapital.kz wrote about this in February (according to other sources, we are talking about 356 million dollars ). At the same time, the publication reported that, for example, the European Bank for Reconstruction and Development (EBRD) acquired 5% of the company’s shares for about 42 million dollars . In Kazakhstan, applications for the purchase of shares were submitted at a price of 1073.83 tenge.
and higher. A few days after the start of the placement, the price per share on KASE reached 1,250 tenge , but then for 7 months there was only a downward trend. Since the beginning of September, the price has been 814-816 tenge per share. What caused the 30% drop in the value of the Central Bank, one can only guess, because this is a multifactorial issue. Firstly, from the financial statements for the 1st quarter it became known that the group received a loss of 5.2 billion tenge. The company explained this, among other things, by seasonal market features, as well as "one-time expenses for the IPO in the first quarter of 2024 in the amount of about 2.8 billion tenge" , Kursiv.kz reported . In general, while Air Astana itself remained quite successful during this period (its operating profit exceeded 10 billion tenge ), its subsidiary low-cost airline Fly Arystan, on the contrary, showed an operating loss of almost 10 billion tenge . As a result, the low-cost airline’s performance had a disastrous effect on the group’s overall financial results. Secondly, public figures periodically express dissatisfaction with the company’s performance. Recently, Majilis deputy Bakytzhan Bazarbek told during a meeting of the lower house of parliament how he suffered because of a flight delay, providing the statement with details: "... Peter Foster, despite the fact that many people suffered, was sitting in the lounge bar and drinking tea. We pulled him out and forced him to talk to people." Despite the abundance of methods for assessing efficiency, in the case of Air Astana, we decided to study two indicators illustrating the financial and economic position of the company and the quality of service (namely, punctuality). Profit (from 2005 to 2024, indicators at 5-year intervals) The group’s earliest publicly available report dates back to 2005. Let us recall that it was in this year that Peter Foster became the head of the company. Then it showed a profit (after tax) of just under 2.6 billion tenge . After 5 years, the profit was 11.4 billion tenge , in 2015 - less than 10.4 billion tenge . The pandemic year 2020 was very unsuccessful for the airline. The loss amounted to 38.7 billion tenge (the operating loss in 2020 was 28 billion tenge ). Profit for 2021: 15.5 billion tenge ( 2022 : 37.6 billion tenge , 2023 : 30.7 billion tenge , 1st half of 2024: 2.2 billion tenge ).
Flight on-time performance (% of flights completed on time and with a delay of no more than 15 minutes) over the past 5 years: 2019 - 84.4%, 2020 - 88%, 2021 - 82%, 2022 - 74%, 2023 - 79%, 1st half of 2024 - 75.9%. For comparison : according to the results of 2023, Colombian Avianca Airlines was recognized as the most punctual in the world (85.73%). As for reliability issues, Airlineratings.com gives Air Astana a 7 out of 7 rating . One of the parameters, among others, is the incident rate: here the platform awarded the company 3 points out of 3 possible, judging that there have been no incidents related to pilots (for example, running off the runway) over the past 5 years. It should be noted that in April, an Air Astana pilot was detained at the Almaty airport for drug intoxication, although he was flying as a passenger. In a recent interview with Victoria Novichkova (CEO of Freedom Mobile and Freedom Drive), Tatyana Foster admitted that she is Peter Foster’s third wife and that she once worked at Air Astana, where, in fact, she met him. The couple is raising two sons together. As indicated on her Instagram account , the wife of the head of the airline is the author of digital video content and has recently been living in Brighton with her sons. It should be noted that Tatyana has 73.4 thousand subscribers, which obviously allows her to monetize her account. Among the companies she promotes are LG and the luxury cosmetics brand Margy’s Monte Carlo. In addition to blogging, Tatyana is trying to do business. She is a co-owner of the travel agency Astra travel company , which paid about 1.3 million tenge in taxes to the budget from 2020 to 2022. After that, the payments are zero. It should be noted that the anti-corruption service has an encumbrance on the share of her business partner, Dilyara Aidarbekova (wife of the publisher and member of the local Forbes list Armanzhan Baitasov ). Another business partner in this LLP is a specialist in tourism and guest business Alexander Aknazarov . Also, Tatyana Foster is a co-founder of the NGO "Thank You Doctors" . In addition to her, 9 more people participate in the public organization, including businessman Arlan Shabdarbaev (we assume that he is the son of the former chairman of the National Security Committee and ex-commander of the Republican Guard Amangeldy Shabdarbaev) . The NGO does not have any tax deductions.
As an individual entrepreneur, Tatyana Foster provides other individual services. Previously, she headed and was a co-founder (from 2015 to 2020) of Medical Avenue Kazakhstan LLP. Apparently, the company is engaged in organizing treatment in South Korea, and its tax payments since 2015 amount to 34 million tenge . Among the failed projects of Peter Foster’s wife is Royal Hotels Group Kazakhstan LLP. In the registers, she is listed as the head of a company already recognized as inactive. Its founder is Rostislav Berezovsky , co-owner of Royal Hotels Group LLC, registered in Yalta.
