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Israeli carrier agrees to bailout terms after virus losses
[JERUSALEM] Israeli airline El Al said Monday it had agreed to a government bailout that could pave the way for the carrier's renationalisation, after losses linked to the novel coronavirus pandemic.
"The board of directors of El Al accepted financial help from the State of Israel consisting of a US$250 million loan", a statement by the company said.
The plan also reportedly involves a stock offering, with the government agreeing to absorb any stock left unsold from that offering.
El Al has been struggling to stay afloat following losses caused by population lockdowns amid the pandemic.
In March, the firm announced that it would lay off 1,000 of its 6,000 staff.
Israel imposed tight lockdown restrictions following its first registered Covid-19 case in February, including major restrictions on flights.
As a result El Al was forced to cancel flights and had to reimburse tickets to thousands of passengers.
Last week it was forced to halt all its flights, after a breakdown in talks between employees and management over redundancies saw pilots refuse to take to the skies.
El Al was a state company from its creation in 1948 until the early 2000s when it became a privately-owned airline.
The government and parliament must approve any renationalisation plan.