Covington Helps airBaltic Secure EC Recapitalization Approval

Covington Helps airBaltic Secure EC Recapitalization Approval

July 6, 2020

BRUSSELS—Covington advised airBaltic on the notification to the European Commission of a €250 million recapitalization by the Latvian government. The measure was approved today under the EU’s Temporary Framework for State aid measures to support the economy in the current COVID-19 outbreak.

In the second quarter of 2020, Member States and non-EU countries implemented travel restrictions in response to the health emergency. airBaltic has suffered substantial losses resulting from these travel restrictions and the coronavirus outbreak, and is currently facing an acute risk of default and insolvency. The aid will support airBaltic during the COVID-19 crisis, save jobs and maintain the connectivity of the Baltic region to the rest of the world.

Executive Vice-President Margrethe Vestager, in charge of EU’s competition policy, said: “The recapitalisation measure will help airBaltic weather the current coronavirus crisis, which has hit the airline sector particularly hard. airBaltic contributes to ensuring the essential domestic and international connectivity needs of Latvia. Given the geographic location of the country, the national economy, many jobs and the development of foreign trade rely on these services.”

The Covington team was led the by co-chair of the firm’s global competition team Johan Ysewyn and senior advisor Sophie Bertin, and included Geoffrey Kalantari and Konstantina Sideri.