To compensate the losses caused by the ongoing Covid-19 pandemic and to support overcoming the economic crisis, the Cabinet of Ministers of the Republic of Latvia, as the majority shareholder of the Latvian airline airBaltic, has today, on August 17, approved the investment of EUR 90 million into the equity of airBaltic. It is now subject to the approval of the European Commission.
Martin Gauss, Chief Executive Officer of airBaltic: “The support of our majority shareholder to overcome the crisis reflects the recognition of the positive impact airBaltic has on the economy.”
The investment is planned to be returned to the Latvian state in form of proceeds from selling shares during a planned initial public offering of airBaltic in the future.
When the pandemic started in 2020, the company performed a significant cost reduction program and preserved around 1000 employees which were required to maintain the operation of the airline. The equity received in 2020 has been used responsibly to maintain the company’s operations and cover expenses that could not have been avoided due to the Covid-19 pandemic.
airBaltic is a strategic facilitator of the Latvian economy and is responsible for more than 2.5% of the Latvian GDP. Due to the Covid-19 pandemic the number of passengers carried by airBaltic decreased by 73% in 2020, and significantly influenced company’s operations. To support the local economy, Latvian government provided and continues to provide aid to all industries heavily affected by the crisis, including airBaltic.