RIGA -- The Latvian government has come to an agreement with minotiry shareholder BAS to inject more than 107 million lats (150 million euros) into the ailing airline.
The airline has cancelled nearly 1500 flights in coming months as its financial situation worsens. The airline had requested a 60 million lat bailout to continue operations. It is estimated to have lost around 95 million lats over the past few years, despite a steady growth in traffic.
"I congratulate the Transport Ministry and our consultants ''Prudentia'' to finally achieve an agreement between ''airBaltic'' shareholders to stabilize the work of the airline," Prime Minister Valdis Dombrovskis said after hearing about the agreement.
The agreement comes amid heated negotiations between the government and the minority shareholder.
It is still unclear whether the bailout will also result in the resignation of CEO Bertolt Flick, which was a key demand of the government in providing a bailout for airBaltic. Flick's name has recently been mentioned in a high-profile corruption investigation.
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