The airline Smartwings received a loan for two billion crowns, 80 percent of which will be covered by a state guarantee. Four domestic banks will provide the loan. In total, the carrier’s financing will exceed seven billion crowns. Additional money will be provided by Czech shareholders, support for leasing companies, and restructuring. The total funding should thus exceed the company’s liabilities, which are around 6.6 billion crowns.
On the other hand, another domestic airline, CSA, a subsidiary of Smartwings, has gone bankrupt in recent weeks.
According to Smartwings spokeswoman Vladimíra Dufková, the loan is precisely two billion crowns.
The maturity of the loan is six years. The largest part was provided by UniCredit Bank, Komerční banka, ČSOB and Česká spořitelna also participated. However, most of the loans will be guaranteed by Export Guarantee and Insurance Company (EGAP). Smartwings will pay the state-owned company 200 million crowns for this.
According to Smartwings, the transaction also includes agreed support from Czech shareholders, especially the Unimex Group. The company also counts on help from leasing companies and the ongoing restructuring of the company. All this should provide airlines with another five billion crowns. These resources, together with the loan, should exceed all the company’s liabilities and at the same time create a reserve for the resumption of operations.
“This is a key milestone for Smartwings after a year of fighting the effects of the coronavirus pandemic. The loan completes the moratorium process and allows Smartwings to continue operations in the coming period. We appreciate the trust that domestic banks have in our country in cooperation with EGAP at this difficult time.” “said the chairman of the board of Smartwings Jiří Šimáně.
The crisis forced Smartwings to lay off last year. Four hundred eighty-one employees left the company, and others went on unpaid leave. Until now, the company was under a protective moratorium. It expired today.
On the other hand, CSA did not reach state guarantees. Thus, unlike the parent company, the company did not obtain a commercial loan, and the court, at its request, opened insolvency proceedings at the end of February. CSA is now in bankruptcy, its insolvency administrator being INSKOL from Karviná. The airlines owe 1.8 billion crowns. Its owners declared an effort to reorganize and save it.
In recent weeks and months, the Smartwings Group, which includes CSA, has asked the state for help, pointing to helping airlines abroad.
For example, this year, she proposed establishing a compensation program worth half a billion crowns for canceled flights from last spring. However, the state refused special assistance to the air carrier.
Smartwings and CSA belong to the Smartwings Group. It belongs to the Unimex Group, which is owned by entrepreneurs Šimáně and Jaromír Šmejkal. The Chinese investment company Citic Europe holds almost half of the group.