Swiss International Airlines (Swiss) and its sister company Edelweiss, both part of Lufthansa Group, have received a loan guarantee from the government of Switzerland.
The federal government would guarantee 85% of the CHF 1.5B loan. Swiss and Edelweiss would only use the money, and shares of these two airlines would secure the loan.
Here’s the announcement from Swiss:
SWISS on today’s government decision
SWISS and Edelweiss are grateful for the Federal Council’s decision to provide Swiss aviation with the necessary liquidity to survive the impact of the corona crisis. With a bank loan of CHF 1.5 billion, 85% guaranteed by the government and subject to strict conditions, support from Lufthansa, the parent company, and drastic savings measures already adopted by SWISS and Edelweiss, the liquidity required for both airlines should be assured.
SWISS and Edelweiss welcome the fact that the financial support negotiated at short notice with the Swiss government and the bank consortium can now be presented to the Federal Assembly for approval. The loan, which will also benefit airline-related operations, would allow the gradual restoration of vital passenger and cargo links between Switzerland and the rest of the world, so important in terms of the national economy.
SWISS will not be commenting further on this matter at the present time.
This is the first of four countries that need to prop up the Lufthansa Group, whose leading airline is losing million of euros per hour. Belgium (Brussels Airlines) Austria (Austrian) and, of course, Germany (Lufthansa) likely will soon follow Switzerland’s lead.
Switzerland went through painful bankruptcy with its then flag carrier, Swissair, completely collapsed and ceased flying in 2001. Swiss International Airlines was born a year later and taken over by Lufthansa in 2005.