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Under the plan, the government would receive warrants in exchange for funds injected in privately owned Aegean Airlines, which has been hard hit by the pandemic.
Aegean shareholders would in addition provide another 60 million euros in new capital under the plan, government spokesman Stelios Petsas said.
According to Aegean’s 2019 balance sheet, the latest available data, the airline had total equity at that time of 328.4 mln euros, or 71.4 million shares outstanding.
The warrants will give the government the right to buy shares in the airline at a set price and during a specific time period.
“The plan for state support of the airline includes … the participation of its shareholders. It is being evaluated in order to secure the official approval from European Commission authorities,” Petsas told a press briefing.
“Air transport is a crucial sector for the economy, the wings that bring tourists to the country. With the warrants the state will get, when recovery comes, the price of the shares will increase, meaning the state will get money back when this coronavirus adventure is over,” Petsas said.
Aegean, a member of the Star Alliance airline group, swung into the red in the second quarter, reporting a net loss of 73.4 million euros as it was hit by the grounding of planes as the pandemic hammered air travel. Its revenue fell 64% in the first half of 2020.
In May, Aegean said it would ask the country’s big banks for 150 million euros of loans under the COVID-19 Enterprise Guarantee Fund, to deal with hardship related to the pandemic.
Under that programme, the state guarantee would be set at 80% for loans lasting up to five years and for up to 25% of annual turnover. The sum of 150 million euros equals about 11% of the carrier’s turnover.
The airline operated less than 50% of its scheduled flights in August with particularly low load factors, due to travel restrictions after a surge in COVID-19 infections.
($1 = 0.8418 euros)
