The European Commission has approved, under EU State aid rules, a Romanian loan guarantee of up to around 62 million euros (approximately RON 301 million) in favour of Romanian airline Blue Air.
The measure aims at compensating the airline for the damages suffered due to the coronavirus (Covid-19) outbreak, as well as providing it with urgent liquidity support.
Blue Air is a private Romanian airline with bases in Romania, Italy and Cyprus. With a fleet of 18 planes, Blue Air has been serving 92 routes and 15 countries, carrying over 4 million passengers in 2019.
The 62 million euros Romanian loan guarantee is expected to help ensure the orderly continuation of flight services for around 400,000 passengers that have either booked a flight with Blue Air in the coming months or are expecting a refund of their cancelled ticket.
Romania committed to ensure that, after six months, the public guarantee will be terminated, or Blue Air will either submit a liquidation plan or carry out a comprehensive restructuring in order to become viable in the long-term. Such possible restructuring would be subject to the Commission’s assessment and approval.
As noted by the European Commission, Blue Air qualified as a company in difficulty before the coronavirus outbreak, i.e. on December 31, 2019.
More specifically, the company was loss making due to the extensive investments it undertook since 2016 to improve its network of routes. The airline had returned to profitability in 2019 and early 2020, but, as other companies active in the aviation sector, it suffered significant losses due to the coronavirus outbreak and the travel restrictions that Romania and other governments had to impose to limit the spread of the virus.
Top Kinisis Hellas represents Blue Air in Greece as its General Sales Agent (GSA).