Lufthansa, Air France-KLM shares progress thanks to rescue

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FILE PHOTO: Air France group logo KLM is pictured on the first Airbus A350 of the Air France airliner during a ceremony at the headquarters of the Airbus aircraft manufacturer in Colomiers near Toulouse, France, on 27 September 2019. REUTERS / Regis Duvignau

PARIS (Reuters) – Air France-KLM shares (AIRF.PA) and Lufthansa LHAG.CE on Monday led the European stock market, hoping that government bailouts would lead them through the coronavirus crisis.

Lufthansa rose 7% in Frankfurt after a German minister said it should be supported, while Air France-KLM was up 3.5% at 8:29 a.m. GMT as investors digested a package 7 billion euros ($ 7.6 billion) in French government loans announced Friday night. .

Lufthansa, which warned last week that it had the cash to survive for a few weeks without help in a shutdown of global air transport, is in talks on a package of state aid worth around 10 billion euros, sources said.

German Transport Minister Andreas Scheuer said on Monday that he supports the carrier’s support.

Announcing the loans from Air France-KLM, with another 2 to 4 billion euros to come from the Dutch government, the Franco-Dutch group said that it planned to raise new equity capital next year, with France likely to participate.

Paris is also preparing to guarantee an additional 5 billion euros in loans to Renault (RENA.PA), Said Finance Minister Bruno Le Maire. The French manufacturer’s share is up 7.5% in Paris, resulting in a 1.6% increase for the CAC-40 benchmark.

Report by Laurence Frost; Editing by Jan Harvey

Our standards:Principles of the Thomson Reuters Trust.

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