KLM secures EUR3.4bn financing commitment from Dutch Government

KLM Royal Dutch Airlines secured (26-Jun-2020) financing for EUR3.4 billion from the Dutch Government to ensure liquidity. The package and the conditions under which it is provided by the state are subject to parliamentary approval in the Netherlands and the European Commission. Once approved, KLM will consult with trade unions on the conditions that the government imposes on the employment of KLM staff. The financing package consists of:

• A 90% state guaranteed revolving credit facility of EUR2.4 billion with a maturity of five years. The facility is granted by three Dutch and eight foreign banks;
• A direct state loan of EUR1 billion with a maturity of 5.5 years. The loan will be subordinated to the revolving credit facility.

Following parliamentary approval, the first EUR665 million drawing under the new revolving credit facility will be used to repay and terminate the existing revolving credit facility drawn on 19-Mar-2020. At that time, KLM will also withdraw a pro-rata amount of EUR277 million from the state loan. Follow-up withdrawals under the revolving credit facility and the direct state loan are only possible if certain restructuring conditions imposed by the state are met. KLM will suspend all dividend payments until the two loans are repaid in full. [more - original PR - KLM] [more - original PR - Air France-KLM]