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Austria strikes 450m euro bailout deal for Lufthansa unit: sources

[VIENNA] Austria has agreed to a smaller-than-expected bailout package for Lufthansa unit Austrian Airlines of 450 million euros (S$707.8 million) in loans and grants, people familiar with the matter said on Monday.

The package consists of 300 million euros in loans that the government will guarantee 90 per cent of, as well as 150 million euros in grants, the people said. Lufthansa has agreed to provide its Austrian unit with an additional 150 million euro grant of its own, they added.

The agreement comes after a 9-billion euro bailout deal between Austrian's parent company Lufthansa and the German government. It is also significantly smaller than had long been expected - in April the airline originally applied for 767 million euros in aid from the Austrian government.

Lufthansa declined to comment while the Austrian government could not be immediately reached for comment.

REUTERS

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