German government grants Condor €380 million bridging loan

Darren Wood
By Darren Wood October 14, 2019 15:04

German government grants Condor €380 million bridging loan

The European Commission has approved a six-month €380 million bridging loan to German carrier Condor – as it emerges from the collapse of the Thomas Cook Group.

The disbursement of funds will be paid out to Condor gradually by German state bank KfW. 

A statement from Condor said: “The decision supports Condor to continue its business operations and the traditionally weaker winter booking period can be bridged even after the insolvency of Thomas Cook Group.”

The decision to approve the temporary €380 million loan to the airline is said to contribute to ensuring the orderly continuation of air transport services and avoid disruptions for passengers, a European Commission statement said.

The airline faces an acute liquidity shortage following the entry into liquidation of its parent company, the Thomas Cook Group. Furthermore, Condor had to write off significant claims against other Thomas Cook Group companies, which Condor will no longer be able to collect.

Under the loan agreement, Condor will need to demonstrate its liquidity needs on a weekly basis, under the conditions of the loan, and new instalments will only be paid when prior liquidity is exhausted.

After the six-month loan period is up, Condor will either have fully repaid, or will carry out a comprehensive restructuring in order to return to viability in the long-term. Restructuring would be subject to the Commission’s assessment and approval.

Ralf Teckentrup, CEO of Condor Flugdienst GmbH, commented: “We are very pleased that the European Commission has made such a timely and positive decision. The bridging loan is an important step towards securing Condor’s future.

“A healthy business like Condor is also in the interest of a properly operating market, because we are not only a significant competitor in the tourism sector, but also important for the competition in the German and European aviation industry.”

Darren Wood
By Darren Wood October 14, 2019 15:04