The u.s. Treasury will lend billion to five airlines

Photo: Matt York, Associated Press
American Airlines is part of the first airlines to have accepted the terms and conditions of the government for a loan financial.

The u.s. government agreed on Thursday with five major airlines, battered as the rest of the sector by the pandemic, in terms of significant financial loans granted in exchange for the counterparties to the taxpayer.

It has planned to lend a total of $ 25 billion to the companies of air transport in the framework of the gigantic stimulus package of $ 2.2 billion, adopted in march by the United States to support the economy.

But the companies were reluctant to accept this financial assistance for fear of counterparties draconian.

American Airlines, Frontier Airlines, Hawaiian Airlines, Sky West Airlines and Spirit Airlines are the first to have finally approved the terms of the government, said the Treasury in a press release. Discussions are ongoing with other companies in the sector.

The government of Donald Trump has not given details on the amounts of the loans or the terms of the agreement, specifying only that it required the borrowers to provide “warrants “— of the financial products that can be converted into shares — of the shares of the capital or of financial instruments, ” as appropriate compensation for the taxpayers “.

Borrowers must also agree to abide by certain conditions such as maintaining a certain level of employment and of the ceilings on the remuneration of employees, the payment of dividends and share repurchases.

These loans are in addition to another € 25 billion paid by the government in exchange for the commitment of the airlines, hit hard by the drop in air traffic since the beginning of the spread of the COVID-19, do not delete jobs until 30 September.

American Airlines confirmed Thursday it has signed a letter of intent with the department of the Treasury relating to a loan of $ 4.75 billion.

The company hopes to finalize the terms of the contract by the end of September, according to the p.-d. g. of the company, Doug Parker, and the operations officer Robert Isom in a letter sent to employees and viewed by the AFP.

American Airlines announces also expect to have 20 000 employees more than necessary for work in the fall.

“This does not mean that 20 000 of our employees will be laid off in October,” noted the officials in the document. But the company ” continues to work with [the] trade unions to find creative solutions that involve voluntary departures and departures “, is added.