CNBC

  • The deal, which has yet to be approved by competition authorities, includes conditions in return for the handout.
  • KLM will not be able to pay dividends or award bonuses for as long as it receives state support and workers will have to take a pay cut.
  • Market expectations of further state support to troubled airlines lifted the sector during European trading hours.

ceive up to 11 billion euros ($12 billion) in financial aid from the French and Dutch government as the coronavirus pandemic pushes many airlines closer to bankruptcy.

The Dutch government said on Friday that it would provide between 2 billion euros and 4 billion euros in state aid to KLM, while the French cabinet announced a support package of 7 billion euros for Air France.

The deal, which has yet to be approved by competition authorities, includes conditions in return for the handout. KLM will not be able to pay dividends or award bonuses for as long as it receives state support and workers will have to take a pay cut, according to a statement.

The airline will also have to adopt a greener approach, for example, by cutting back the number of night flights.

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