Aer Lingus in talks with State fund on Covid support

Aer Lingus is in talks with the Ireland Strategic Investment Fund (ISIF) to secure additional funding from its €2 billion pandemic recovery fund set up last year to support medium- to -large-sized companies through the Covid-19 crisis.

Conor O'Kelly, chief executive of the National Treasury Management Agency (NTMA), which is responsible for ISIF, confirmed that discussions were ongoing at an appearance before the Oireachtas Public Accounts Committee on Thursday.

He also said that ISIF has committed about €800 million to date from the fund to companies, half of which has been allocated so far in 2021. The fund agreed last year to provide a €150 million loan to Aer Lingus in two tranches, with the second drawn down in March.

ISIF is “in discussions with Aer Lingus to see if they will need any further assistance”, Mr O’Kelly told the committee on Thursday.

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Aer Lingus chief executive Lynne Embleton said in July that the airline, which is part of International Airline Group (IAG), could seek a second loan from the ISIF fund as it emerges from tough Government Covid-19 curbs. She made the comments as the airline reported that its operations lost €192 million for the first six months of this year, a similar loss to the €189 million incurred during the same period in 2020.

She noted at the time that Aer Lingus had been the hardest hit of IAG carriers, largely due to Irish Government travel restrictions during the reporting period, which were among Europe's toughest. The Irish airline is currently seeking to push through a round of cost-cutting.