Latvian airline airBaltic has been approved to receive an investment of €90 million into the equity of airBaltic by its majority shareholder the Cabinet of Ministers of the Republic of Latvia. The new funds are to “compensate the losses caused by the ongoing COVID-19 pandemic and to support overcoming the economic crisis”. The loan is now subject to the approval of the European Commission.
Martin Gauss, Chief Executive Officer of airBaltic said: “The support of our majority shareholder to overcome the crisis reflects the recognition of the positive impact airBaltic has on the economy.”
airBaltic has positioned as a major contributor to the Latvian economy, estimating that it is responsible for more than 2.5% of the Latvian GDP.
The investment is planned to be returned to the Latvian state in form of proceeds from selling shares during a planned initial public offering of airBaltic “in the future” announced the airline, which stressed that the company had performed a significant cost reduction program, while preserving around 1000 employees. airBaltic’s reported a 73% fall in passenger numbers in 2020 compared to 2019.
The airline stated that the equity received in 2020 “has been used responsibly to maintain the company’s operations and cover expenses that could not have been avoided due to the Covid-19 pandemic”.