- Title: Netherlands agrees to contribute 3.4 bln euros to Air France-KLM bailout
- Date: 26th June 2020
- Summary: ROISSY-EN-FRANCE, FRANCE (FILE - JUNE 11, 2016) (REUTERS) AIR FRANCE PLANE TAXIING ON RUNWAY AIR FRANCE PLANE TAILS JET BRIDGE CONNECTING TO AIR FRANCE PLANE AIR FRANCE PLANE ON TARMAC ROISSY-EN-FRANCE, FRANCE (MAY 6, 2020) (REUTERS) VARIOUS OF AIR FRANCE PLANES ON TARMAC VARIOUS OF AIR FRANCE STEWARDESS DISTRIBUTING FACE MASKS TO PASSENGERS DURING BOARDING VARIOUS OF PASSENGERS WEARING FACE MASKS INSIDE PLANE VARIOUS OF TRAVELERS WEARING MASKS WAITING AT BOARDING GATE PLANES ON TARMAC SEEN FROM INSIDE AIRPORT
- Embargoed: 10th July 2020 02:58
- Keywords: Air France KLM coronavirus
- Location: PARIS & ROISSY-EN-FRANCE, FRANCE / SCHIPHOL, THE NETHERLANDS / BERLIN, GERMANY
- City: PARIS & ROISSY-EN-FRANCE, FRANCE / SCHIPHOL, THE NETHERLANDS / BERLIN, GERMANY
- Country: Various
- Topics: Company News Markets,Economic Events
- Reuters ID: LVA003CK0B8LJ
- Aspect Ratio: 16:9
- Story Text:The Dutch government have reached a deal with France to contribute 3.4 billion euros ($3.8 billion) to an Air France-KLM bailout that had strained relations between the airline group's state shareholders, sources told Reuters.
The agreement will see the Netherlands issue direct loans and guarantees to KLM and appoint a trustee to its board, two people with knowledge of the matter said.
Air France-KLM and the French finance ministry declined to comment, but the Dutch finance ministry later announced a Friday morning news conference to "detail the financial aid package for KLM". A statement that briefly appeared on the group website also mentioned its 3.4 billion-euro value.
The governments, which each own about 14% of Air France-KLM, unveiled 7 billion euros in French aid in April and a planned 2 billion-4 billion euros from the Netherlands, as the coronavirus crisis brought air travel to a near-halt.
The Dutch funds have been held up by parliamentary scrutiny and by tense negotiations in which France rebuffed The Hague's demands for a voting seat on the KLM board, which would have weakened the group's hold on its Dutch subsidiary.
Instead, the agreement would involve the appointment of a non-voting government observer to ensure taxpayers' bailout money is strictly reserved for KLM operations, the sources said.
The French and Dutch governments remain at loggerheads over management and strategy at Air France-KLM, created by the 2004 merger between the two national carriers.
Frustrations exploded in March last year with the Dutch state's surprise acquisition of a stake in the group, designed to match France's holding and counter its clout.
Prior to the pandemic, a specially convened intergovernmental group had reported no progress on issues that included Dutch demands for board seats and greater KLM autonomy from its parent group.
But the KLM aid deal may also resolve parts of that stalemate, the sources said, after the subject came up in talks this week between French President Emmanuel Macron and Dutch Prime Minister Mark Rutte.
The Dutch aid package is also likely to come with environmental conditions and restrictions on executive pay demanded by lawmakers.
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