Green light for Condor loan

After the Thomas Cook bankruptcy, the future of the German subsidiary was uncertain. Now the way is clear for an important loan.

Green light for Condor loan
dpa

Brussels (dpa) - The European Commission has approved a German bridging loan worth 380 million euros (419.3 million dollars) for the charter airline Condor, a subsidiary of British tour operator Thomas Cook which collapsed and filed for liquidation last month.

The loan, split between the federal government and the German state of Hesse, is aimed at keeping Condor afloat. The airline plans to extract itself from joint liability with Thomas Cook, according to Berlin.

The commission - which acts as the European Union's competition watchdog - approved the loan on Monday after establishing that it would not give Condor an unfair advantage.

"The measure will contribute to ensuring the orderly continuation of air transport services and avoid disruptions for passengers," it wrote.

The six-month loan will be paid out in instalments "under stringent conditions," the commission noted, adding that Condor would have to demonstrate its liquidity needs on a weekly basis. New instalments will only be paid out when the company runs out of money.

Germany has also committed to ensure that the loan is repaid after six months, or else make Condor undergo a "comprehensive restructuring" to return to long-term viability, the EU's executive added.

These conditions "will reduce the distortion of competition potentially triggered by the state support to a minimum," the commission concluded.

Condor has an overall 4.900 employees. The company is now in talks with potential buyers.