Companies Swiss and Edelweiss should be able to overcome their liquidity problems with federal guarantees. The Federal Council decided on Wednesday to ask Parliament for nearly 1.9 billion francs to support the entire aviation sector.
Swiss and Edelweiss are expected to require around CHF 1.5 billion in liquidity until the end of the year. They will be made available through a consortium of banks, by analogy with Covid-19 credits. In total, 85% of the funds used, but at most 1.275 billion francs, will be guaranteed by the Confederation.
EasyJet Switzerland should be able to cover its liquidity needs with the help of its parent company. The Federal Council judges the conditions for a subsidiary commitment of the Confederation not met from the current point of view. In addition, with a turnover of less than 500 million francs, easyJet Switzerland could apply for a Covid-19 transition credit.
Nothing for Swissport and Gategroup
Other related companies are necessary to maintain Switzerland’s international connections. Swissport International, Gategroup and SR Technics are however active on an international level and majority-owned by Asian investors.
The current structures of the companies Swissport and Gategroup do not yet make it possible to fulfill the conditions set for the granting of financial aid by the Confederation. For SR Technics, the guarantees required could in principle be provided for possible loans.
To prevent the resumption of operations from being compromised by the failure of a systemically important company, backup structures must be prepared under the operational management of national airports. Their concrete design and the distribution of financial charges must be specified with the airports and the cantons in which they are located.
The resources required for possible aid measures in favor of the essential parts for Switzerland of related enterprises are estimated at around 600 million francs.
The Federal Council previously announced its intention to help the aeronautical industry as an essential infrastructure for the economy. A long-term interruption of Switzerland’s international connections would cause considerable economic losses.
As promised, aid will be subject to strict conditions. Public authorities will only act in the alternative. The funds guaranteed by the Confederation may be used exclusively for Swiss infrastructure and the funds generated must be used in priority to reimburse the aid. The distribution of dividends and the refunds or transfers within a group before the full repayment of the loans are excluded. (ats / nxp)
Created: 04.29.2020, 3:28 p.m.