The public financing contract signed in November 2020 between Air Europa and the State Company for Industrial Participations (SEPI) has been instrumental in the survival of the airline during the Covid-19 crisis. The aid, totaling 475 million, was the largest granted by the Fund to Support the Solvency of Strategic Companies (FASEE), aimed at supporting companies affected by the pandemic. The conditions of the aid were demanding, requiring strict guarantees from Globalia airline.
However, controversy surrounding allegations linking President Pedro Sánchez’s partner, Begoña Gómez, with favorable treatment towards Air Europa have caused tension. A complaint by the pseudo-union Manos Cleans against Gómez for alleged influence peddling led to legal proceedings. Despite this controversy, the Prosecutor’s Office has requested that it be dismissed.
Before approving public support, Air Europa underwent audits by Cuatrecasas, PwC, and the State Attorney’s Office to assess its eligibility and viability. The management council of FASEE and the Council of Ministers also reviewed these reports. SEPI’s entry into management with representation on Air Europa’s board was a requirement for receiving funding.
The SEPI public credit was a last resort for Globalia as they had exhausted other financing options. The contract mandated specific allocations of funds and required SEPI’s approval for key decisions such as asset sales or changes in corporate structure or auditor appointments. The involvement of SEPI played a crucial role in approving significant financial and strategic decisions for Air Europa.
Air Europa previously secured bank financing through ICO before receiving funding from SEPI. After receiving part of their loan back and facing disputes related to Covid-19’s impact on their hotel and transportation activities, they agreed to receive SEPI aid with fixed and variable interest rates and an agreement to involve them in key management decisions.
In conclusion, while there have been allegations linking political leaders to favorable treatment towards Air Europa, FASEE’s rigorous conditions ensured that only viable companies received support during this challenging time.
