FRANKFURT: German airline Lufthansa said Monday it has received approval for a €9 billion ($9.8 billion) “stabilization package” from a government support fund to keep the company going through the turbulence from the coronavirus outbreak, but cautions the deal has not been approved by the EU’s executive commission.
Lufthansa, which has lost most of its passenger business due to travel restrictions during the outbreak, said the government’s fund has agreed to take nonvoting holdings in return for €5.7 billion, plus a €3 billion credit line and €300 million in share purchases.
That would leave the government fund with a 20-percent stake in the company and two seats on the board of directors. One of those seats would be on the audit committee.
The airline said however that the government agreed not to vote its shares at shareholder meetings unless there was a takeover of the company.
The company’s trading statement said that the deal has not been approved by the European Commission, which could set conditions intended to preserve fair competition.
The aid package would also require approval by a shareholder meeting.
German business publication Handelsblatt said that German Chancellor Angela Merkel was resisting a push by the commission to make Lufthansa give up prized landing slots at its Frankfurt and Munich hubs.