KLM secures loans of €3.4 billion to help overcome the crisis and prepare for the future
26 Giugno 2020 - 08:00AM
KLM secures loans of €3.4 billion to help overcome the crisis and
prepare for the future
Roissy, 26 June 2020
KLM secures loans of €3.4 billion to
help overcome the crisis and prepare for the future
On 25 June 2020, the Air France-KLM Group Board
of Directors approved a financial support package backed by the
Dutch State for KLM in the amount of €3.4 billion. These loans will
enable KLM to weather the current COVID-19 crisis and prepare for
the future.
The Dutch state aid to KLM comes in addition to
the €7 billion in funding granted by the French State to Air France
announced on 7 May 2020.
Following discussions with the Dutch State and
several Dutch and international banking institutions, the Air
France-KLM Group and KLM were able to finalize the various
components of a financial support package.
This financing includes two loans for KLM and
its subsidiaries:
- A revolving credit facility of €2.4 billion, granted by 11
banks, of which three are Dutch banks and eight are international
banks. The main elements include:
- 90% guarantee supported by the Dutch State
- Maturity of 5 years
- Coupon at an annual rate equal to EURIBOR (floored at zero)
plus a margin of 1.35%
- A cost of guarantee granted by the Dutch state equal to 0.50%
in year 1, 1.00% in year 2 and 3, and 2.00% after year 3
- A direct loan of €1 billion, granted by the Dutch State to KLM,
with the following main elements:
- Term loan of €1 billion
- Maturity of 5.5 years
- Coupon payable annually at a rate equal to EURIBOR 12 months
(floored at zero) plus a margin of 6.25% for year 1, 6.75% for year
2 and 3, and 7.75% for year 4 and 5
- Subordination to the new revolving credit facility
Both the revolving credit facility and the
direct loan will be drawn on a pro rata basis. Further drawings
subsequent to the first drawing are subject to certain conditions
being fulfilled by KLM. KLM’s first drawing under the new revolving
credit facility will be used to repay and terminate the existing
revolving credit facility drawn on 19 March 2020 for an amount of
€665 million.
Conditions associated with the direct state loan
are linked to the airline becoming more sustainable as well as the
restored performance and competitiveness of KLM, including a
comprehensive restructuring plan and contributions made by
employees.
KLM has undertaken to suspend dividend payments
to its shareholders until these two loans have been repaid in
full.
This state aid, which remains subject to
approval by the European Commission and the Dutch Parliament, will
provide KLM with the necessary means to meet its obligations and
adapt in a sector that the global crisis will severely disrupt.
“On behalf of all the employees at the Air
France-KLM Group, I would like to thank the Dutch State and the
financial institutions for their support to KLM in this
unprecedented crisis for the airline industry,” said Benjamin
Smith, CEO of the Air France-KLM Group. “KLM is a strategic asset
for the Netherlands, and I’m pleased to have seen the country rally
around this national champion during this very challenging period.
I’m also proud to note that KLM plays a critical role in the Dutch
economy, and we are willing to do what we can to assist in its
recovery process. Thanks to the support of the Dutch and French
states, I am certain that the Air France-KLM Group will emerge
stronger than ever before following this crisis.”
"Due to COVID-19, KLM is currently in an
unprecedented crisis,” said Pieter Elbers, CEO of KLM. “The
financing package is necessary to secure the long and difficult
road of recovery in the coming period. This is a very important
step and I express my gratitude on behalf of all KLM colleagues to
the Dutch state and the banks for their confidence in our
organisation and our future. With the financing package, KLM can
continue to fulfil its important social role in economic recovery
and sustainability. In the coming period, we will be working on the
restoration of the route network and, on the other hand, on the
development of the restructuring plan and the far-reaching
conditions that have been imposed on the package.”
Investor
relations
Press office
Olivier
Gall
Wouter van
Beek
+33 1 49 89 52 59
+33 1 49 89 52
60
+33 1 41 56 56 00
olgall@airfranceklm.com
wouter-van.beek@airfranceklm.com
Website: www.airfranceklm.com
- Press release Dutch state support VE
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