[News] PLAN to rescue Lufthansa: Berlin authorities reach agreement with EU

[Mindsphere.]

 

The plan to support the German airline Lufthansa with nine billion euros went through a crucial stage on Friday night, after the German Government and the European Commission reached an agreement on the main conditions of this operation, AFP reports, according to AGERPRES.

The compromise, reached by Berlin and European Commission negotiators, sti[CENSORED]tes that Lufthansa will cede to competitors up to 24 take-off and landing slots used by eight aircraft stationed at Frankfurt and Munich airports. Lufthansa said that these slots could be taken over by a European competitor that did not receive state aid due to the coronavirus pandemic.

"The company's management has accepted the concessions, which are small compared to what was initially mentioned and are now awaiting approval by the supervisory board," Lufthansa said in a press release.

The previous conditions included the transfer by Lufthansa of 72 take-off and landing slots used by 12 of the company's 300 aircraft stationed at Frankfurt and Munich airports.

The largest rescue operation of a company launched by the German government since the onset of the coronavirus crisis predicts that the Berlin government will take a 20% stake in Lufthansa in exchange for 300 million euros. The German executive will also inject 5.7 billion euros into Lufthansa and development bank KfW and other banks will lend the company three billion euros over three years. It will be the first time since the complete privatization of Lufthansa, in 1997, when the German state will become a shareholder in the airline again.

Other major airlines such as Air France-KLM, American Airlines, United Airlines and Delta Air Lines have also called for state aid due to the economic effects of the pandemic.

In early May, the European Commission allowed France to provide seven billion euros in support to Air France, the aid will be made up of a four billion euro loan from a six-bank union, and 90% guaranteed by the French state, as well as a direct loan of three billion euros granted by the French state.