JERUSALEM, June 7 (Reuters) - The government is asking El Al Israel Airlines to issue shares as part of a bailout package, the carrier said on Sunday.
El Al, Israel’s flag carrier, was seeking state-backed loans of $400 million to help it through the coronavirus crisis, as foreigners are barred from entering the country and incoming Israelis must self-quarantine.
The airline, which warned last month that it could collapse should talks fail to secure a loan, suspended passenger flights until at least June 20 and about 6,000 of its 6,500 workforce are on unpaid leave until June 30.
Under a plan laid out by the Finance Ministry, El Al said it would receive a $250 million loan mostly guaranteed by the government. In addition the airline would have to sell $150 million worth of shares, with the government committing to buy any shares not bought, El Al said in a statement.
Those shares would be placed with a trustee.
The terms are subject to El Al’s consent, and require approval of the cabinet and parliament’s finance committee. They also would require El Al signing a deal with employees to make the airline more efficient, it said.
El Al said it would examine the proposed offer. (Reporting by Steven Scheer; Editing by Tova Cohen)