The payment of interest by Air Europa during the term of the state loan represented a daily financial burden of almost 70,000 euros, a component that, according to company representatives, reinforces the assumption that the assistance received never meant the receipt of free or subsidized funds. According to Europa Press, the total interest payout was 97.2 million euros, representing an additional 20% of the loan amount. This financial dynamic is part of the broader context of the full and early repayment of the debt granted during the pandemic, a measure facilitated by the recent injection of foreign capital following the agreement between Air Europa and Turkish Airlines.
As Europa Press highlighted, Turkish Airlines paid out 300 million euros and acquired 26% of Air Europa’s share capital. This operation significantly changed the airline’s shareholder structure, establishing the Hidalgo family – through Globalia holding – as the majority shareholder, while the IAG Group consolidated a 20% stake. The entry of the Turkish company also marked a change of stage for the Spanish company, which is now valued at 1,175 million euros and is strengthening its position in the aviation industry through greater diversification of capital and corporate control.
The early settlement of all financial liabilities was completed approximately one year before the originally agreed term. As Europa Press reports, the initial balance included a capital amount of 475 million euros granted by the State Society of Industrial Participations (SEPI) and a bank loan of 141 million euros guaranteed by the Official Credit Institute (ICO), which together amounted to more than 600 million euros. This sum was key to preserving almost 4,000 jobs and creating around 600 new positions during the most critical phase of the health crisis, while the company faced cuts and operational disruptions due to the global health emergency.
Europa Press explained that in addition to acting as a lender, SEPI has also joined Air Europa’s board since November 2020 and constantly monitors the company’s strategic, financial and operational decisions. This institutional integration ensured continuous monitoring of deposited funds and strict adherence to the profitability plans required by the company. The relationship was maintained until the final repayment of the debt, a process that included the validation of all execution phases and allowed the conclusion of the agreement under parameters that the company defines as purely commercial.
Juan José Hidalgo, president of Globalia, stressed in statements reported by Europa Press that “neither Globalia nor Air Europa has taken a single euro from a taxpayer,” distinguishing the repayment of the loan from any kind of government bailout or tax break. Hidalgo emphasized that the lending business complies with normal market rules and is secured by personal guarantees from the company’s main partners. “We saved him, we moved him forward, we paid every euro without any help or anything in return,” he told Europa Press, referring in particular to his family’s commitment to the settlement and reimbursement.
Europa Press also pointed out that the influx of foreign capital, legally led by Javier Hidalgo and his team, made it possible to cancel all financial obligations in advance. The media pointed out that the reorganization of the stake was carried out through months of negotiations, ensuring compliance with all applicable regulations and the relevant documentation to ensure the transparency of the process. Globalia’s declared transparency policy was supported by the monitoring of state authorities from the formalization of the loan to its full repayment, according to Europa Press.
The administration of funds from the state loan coincided with a period of unprecedented crisis and contraction in international air transport, according to Europa Press. Nevertheless, Globalia stuck to the commitments it had made to secure employment and economic viability, allowing the airline to start a new cycle following the entry of Turkish Airlines. Europa Press reiterated that in this process, the holding company’s managers reiterated their position that the financial relationship with SEPI is anchored in standard commercial agreements and that neither party can claim benefits, direct subsidies or exceptional tax powers.
Regarding the public debate triggered by the loan, the company stressed, according to Europa Press, that there were no favorable conditions compared to other similar deals on the Spanish market. Hidalgo and the rest of management insisted that all regulatory policies and obligations, as well as administrative oversight, were part of current institutional controls and were properly documented by the relevant organizations.
From a business perspective, after foreign investment and early debt repayment, the new scenario offers Air Europa greater financial independence and a platform to consolidate its position on the global air transport map. Europa Press emphasized the importance of restoring economic balance and maintaining the work structure as objectives achieved by the operation. In addition, the company told the media that after the debt repayment there was no negative impact on commercial demand, on the contrary: in the months after the restructuring, high occupancy rates and an increase in passenger traffic were observed on scheduled flights.
Europa Press also recalled the presence of SEPI as a symbol of guarantee, monitoring and transparency in the process. The company has highlighted this institutional intervention in its communications, highlighting the continued compliance with administrative requirements and the absence of extraordinary tax benefits. Both Globalia and Air Europa have argued that the early repayment of the principal and interest, together with the fulfillment of administrative obligations, constitutes evidence that the operation is not a direct transfer of resources from the state to the private sector.
The structure resulting from the signing with Turkish Airlines allows Air Europa to reach a new level of valuation and attract international investments, since more than a quarter of the operating capital comes from the Turkish airline and the IAG Group consolidates its investment position. According to the information collected by Europa Press, the process responded to a criterion of business viability and the desire to maintain the continuity and stability of the company without relying on public assistance.
The company stressed that the repayment of the loan and the payment of the interest set a precedent in the aviation sector, citing the lack of comparative advantages compared to other companies that received government financial support during the health crisis. Europa Press highlighted that transparency in management, shared responsibility for assets and institutional support have characterized Air Europa’s path in this episode and laid the foundations for autonomous management in the face of possible future challenges within the industry.
About The Author
