What happens next?: After a broken deal, Condor employees demand state aid

After the Condor takeover broke, the workers demanded quick state aid for the Frankfurt holiday pilot.

The German state should take a direct stake in the airlines Condor and Lufthansa, said a spokesman for the pedestrian union Ufo. The pilot union union cockpit also campaigned for help from tax revenue.

On Easter Monday, the Polish aviation holding company PGL canceled the takeover of Condor, which had already been agreed in January, without stating a reason. The most important PGL company Lot, like many other airlines, has been weakened by the corona crisis and is likely to have to seek state aid even in Poland.

According to a spokeswoman, Condor is still in negotiations with government agencies about an alternative solution. This was also confirmed by the black and green state government of Hesse.

The company, with around 4900 employees and more than 50 aircraft, was restructured in a protective shield procedure after the bankruptcy of the British parent company Thomas Cook in September 2019. This self-administration bankruptcy should end with the entry of PGL. The German state could take its place directly or a trustee who would temporarily manage the company as an investor.

Neither Condor nor the federal government has given any information about possible progress. It was heard from corporate circles that the aforementioned date of April 15 for repaying the KfW bridge loan of EUR 380 million could be postponed until the weekend.

Only about two thirds of the loan is said to have been drawn, said another person familiar with the matter. The purchase amount of the Poles in the unknown amount planned for repayment is not available.

Condor did not apply for an extension of the KfW loan approved by the EU, but instead opted for new loans. Additional funds for the rescue could flow from a trust account where customer funds for Condor tickets ended up after April 1st.

The flight operations of the Condor are on solid feet, said the pilot union union cockpit. The support from the federal government is therefore still justified, said VC spokesman Janis Schmitt in Frankfurt. It should not be possible for employees to be dropped in the corona crisis.

It would be a “fatal signal” if the state were the first Condor creditor to turn the juice off, UFO spokesman Nicoley Baublies said. The former Thomas Cook daughter had slipped into the protective shield procedure through no fault of her own and had done her homework in recent months. “The company is transparent and well renovated,” said Baublies.

From the cabin union’s point of view, the state should directly participate in the important air carriers, including Lufthansa, during a transition period and also be represented on the supervisory boards, said Baublies.

This could have an impact on the situation after the crisis, for example to avoid undercutting competition in an otherwise weak market. But new structures could only be decided in many months.

Before the Corona crisis, the holiday airline was indispensable for the travel industry, which always wanted to have a counterpoint to the powerful Lufthansa, especially because of its offer to long-haul destinations overseas. After the Thomas Cook bankruptcy, major tour operators had even considered participating in the airline themselves. Lufthansa had shown interest in a takeover in spring 2019, but ultimately did not bid for Condor due to antitrust law reasons.

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