The German authorities allocate billions of euros to rescue Lufthansa

Власти Германии выделяют миллиарды евро на спасение Lufthansa

The government is ready to allocate Lufthansa 9 billion euros, however, it needs to fulfill a number of conditions, including for the protection of the climate.

The German authorities will provide airline Lufthansa, experiencing, like many of his competitors, is in serious financial trouble due to pandemic coronavirus, an aid package totaling 9 billion euros.

This was stated tonight the leadership of the group, reports Deutsche Welle.

However, this step still must be approved by the European Commission, the Supervisory Board of Lufthansa and the General meeting of shareholders of the company.

According to the German Finance Ministry as a condition for assistance, the group has committed to upgrade their fleet to reduce harmful emissions into the atmosphere. In addition, the group expect significant cuts in the remuneration of its Board members and managers.

Lufthansa will receive credit for three years in the amount of EUR 3 billion from the state Bank KfW and a number of private banks.

The economic stabilisation Fund (WSF) to allocate the concern to 4.7 billion euros in perpetual tacit contribution at 4 per cent in the first two years and 9.5 per cent in subsequent years. This Fund was created by the German government in the course of the pandemic COVID-19, if necessary, the state could acquire a stake in major companies caught up because of the crisis, on the brink of ruin.

The state plans a second secret Deposit for the sum of 1 billion euros and another 300 thousand euros WSF will acquire a 20 percent stake in Lufthansa, the newspaper notes.

The German government confirmed that after the adoption of the package of financial aid the state will receive two seats on the Supervisory Board of Lufthansa.

With this selection by Germany of such a large amount of funds to rescue the airline from bankruptcy may cause problems with the European Commission. Brussels fears of non-compliance with the criteria of fair competition in the European market and the company will nominate its tough conditions. German Chancellor Angela Merkel has already announced in this regard about readiness for “heavy battle.”

The Lufthansa group employs about 138 thousand employees.

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