Parliament okays €80m airBaltic loan

Take note – story published 8 years ago

On Thursday the Latvian parliament voted for lending €80m from the State Treasury to the national airline airBaltic, reported LETA newswire.

45 MPs supported the loan, 13 were against, while another two abstained from the vote.

Supporting the state loan were coalition MPs, except notably for former Transport Minister Anrijs Matiss (Unity) as well as Edvins Snore (National Alliance), who abstained from the vote. Voting against the state loan were opposition MPs from For Latvia from the Heart and the Alliance of Regions.

Meanwhile, another 24 MPs did not participate in the vote, including MPs from Harmony, as well as Raivis Dzintars and Inguna Ribena (both National Alliance) and Rihards Eigims (Greens and Farmers Union).

The loan was passed with the clause forbidding to purchase or lease equipment from 'military industrial complex' companies of sanctions-hit countries. That includes Russian-made Sukhoi planes, the possible purchase of which had been a cause of widespread controversy.

On November 3 the government approved an investor for the national airline airBaltic that had been suggested by the Prudentia consulting company - the German businessman Ralf Dieter Montag-Girmes. He will invest €52m into the airline, and in turn get a 20 percent stake in airBaltic, whereas the state will have to invest €80m in the airline.

The Latvian parliamentary committee on budget and finances on December 2 approved a Treasury loan to the national airline airBaltic and its subsequent capitalization. 

Increasing the share capital of airBaltic is necessary so it could pursue its business plan and modernize its fleet.

On Tuesday airBaltic boss Martin Gauss hinted that Canada's Bombardier - with whom airBaltic already has a large order for larger CS300 planes - might provide its smaller CS100 planes even though they are likely to be more expensive.

The government has said before that after this decision it will move onto the next task of finding a major "strategic investor" to pump in even more money than "financial investor" Montag-Girmes.

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