British Airways to get a £2 billion…

British Airways to get a £2 billion loan, backed by UK Export Finance. It had a £300 million loan earlier
2021-01-04 16:59:00
British Airways has been asking for financial help, to get it through the Covid pandemic. Now it has had a new £2 billion funding boost, through a state-backed loan. Its parent company, IAG, has secured commitments for a 5-year loan, underwritten by a syndicate of banks. It is being partially guaranteed by state-backed credit agency UK Export Finance (UKEF) and details are being finalised. The loan has covenants, including perhaps restrictions on dividend payments by the airline to IAG. The money will keep BA going until, it hopes, effective Covid vaccines during 2021 will enable air travel to resume, in high numbers. IAG said it “continues to have strong liquidity with cash and undrawn facilities of €8 billion as at November 30, excluding the UKEF facility.” But it is also looking at other sources of money.  BA had previously received £300 million over a year from a Bank of England loan programme for the UK’s biggest companies. It also claimed support from the taxpayer-funded furlough scheme.  IAG made a pre-tax loss of £6.2 billion pre-tax loss for the first 9 months of 2020, on revenues down 66% to £6.5 billion. BA is also cutting a quarter of its workforce – so losing 12,000 staff.  .Tweet Only 3 weeks ago government said UK Export Finance would not be funding fossil fuel projects in future. For climate reasons. Now it is funding BA, an airline (a very high CO2 emitter). Is that logical?  or consistent?   Is it even vaguely in line with UK climate ambitions? https://www.gtreview.com/news/europe/uk-government-to-end-export-finance-for-fossil-fuels-as-new-applications-roll-in/ BA Covid recovery bid boosted by £2bn bailout by Phil Davies  (Travel Weekly) Jan 4th 2021 BA Covid recovery bid boosted by £2bn bailout British Airways received a £2 billion new year funding boost through a state-backed loan. Parent company International Airlines Group secured commitments for a five-year loan underwritten by a syndicate of banks. It is being partially guaranteed by state-backed credit agency UK Export Finance (UKEF).  [UKEF is the UK’s export credit agency, and provides an export development guarantee to support the working capital and capital expenditure needs of UK exporters that meet certain criteria.] “British Airways expects to drawdown the facility in January 2021 subject to agreement of final terms with the lenders and UKEF,” IAG announced on new year’s eve. “The proceeds from the UKEF facility will be used to enhance liquidity and provide British Airways with the operational and strategic flexibility to take advantage of a partial recovery in demand for air travel in 2021 as Covid-19 vaccines are distributed worldwide. “IAG continues to have strong liquidity with cash and undrawn facilities of €8 billion as at N

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