European Commission approves German govt state aid package

    European Commission approved (25-Jun-2020) German state aid plans to contribute EUR6 billion to the recapitalisation of Lufthansa Group. The Commission concluded that the recapitalisation measure will contribute to manage the economic impact of the coronavirus outbreak in Germany. The recapitalisation measure is part of a larger support package, including a state guarantee that Germany plans to grant to Lufthansa as individual aid under the German scheme, totalling EUR9 billion in additional financing. The plan comprises:

    • EUR300 million equity participation through the subscription of new shares by the German state, corresponding to 20% of Lufthansa‘s share capital;
    • EUR4.7 billion silent participation with the features of a non-convertible equity instrument;
    • EUR1 billion silent participation with the features of a convertible debt instrument;
    • EUR3 billion state credit facility.

    The recapitalisation will be financed by the Economic Stabilisation Fund established by Germany in order to provide financial support to German companies affected by the coronavirus outbreak. [more – original PR]