Cyprus Airways government restructuring loan investigated by EU

The European Commission is investigating the latest plan to rescue Cyprus Airways and is considering whether the €102 million in state aid – which includes a €31.3m ($42.4m) capital injection granted in 2012, a conversion of €63m ($85m) debts into equity and €8.6m ($11.6m) to cover the deficit of the company’s employee benefit scheme – complies with EU state aid rules. The commission has expressed doubts “whether the restructuring plan is suitable to ensure Cyprus Airways’ long-term viability and whether the airline is capable of withstanding likely challenges in the air transport market during the next years”. Cyprus Airways has