Air France-KLM is in talks with banks to receive up to 6 billion euros ($6.5 billion) in loans guaranteed by the French and Dutch governments, as the airline group braces for a sustained CCP virus shutdown, sources told Reuters.
The two states, which each own 14 percent of Air France-KLM, have paused a long-running boardroom feud to address the cash crunch, according to three people close to the discussions. But the crisis ultimately risks deepening their conflict, they said.
Details and amounts are not finalized and could change, the people said. Under the most likely scenario, Air France could get about 4 billion euros in French-guaranteed loans while KLM receives close to 2 billion backed by The Hague, two sources said.
The group has appointed BNP and Societe Generale to advise on refinancing, two of the sources said.
Both banks declined to comment.
“We are naturally in constant discussions with both governments,” an Air France-KLM spokeswoman said, declining further comment.
Governments around the world are scrambling to prop up airlines at risk of bankruptcy as the pandemic gathers pace, gutting travel demand and bringing traffic to a near-standstill.
The French and Dutch governments also declined to comment in detail on the Air France-KLM talks. Both countries have expressed willingness to offer financial help.
“We’ve been in discussions for a long period of time with KLM and Air France, and very specifically with the French state,” Dutch Finance Minister Wopke Hoekstra told Reuters on April 1. “It’s extremely important to help this vital company through these difficult times.”
