MOSCOW (Reuters) - Russia has drafted a support plan for Aeroflot where the government and state bank VTB would buy into a new share issue by the country’s biggest airline, which has been hit by the coronavirus crisis, two sources with direct knowledge of the plan told Reuters.
The Russian Direct Investment Fund (RDIF) may take part in that share issue along with the state and VTB, one of the sources said, adding that under the plan, Aeroflot would be issuing new shares worth 80 billion roubles ($1.15 billion).
The state plans to buy shares worth 50 billion roubles, with VTB and RDIF buying shares worth 15 billion roubles each, the source added. The second source said that the new share issue was expected to be “significant.”
An RDIF spokesman told Reuters that the fund, along with some international partners, was considering investing in Aeroflot, without providing details.
“We don’t have such information,” Aeroflot said in emailed reply to a Reuters request for comment. A government spokesman and VTB did not immediately reply to requests for comment.
Aeroflot, 51.2% state-owned, was hit hard by the coronavirus pandemic, as countries shut down borders, while Russians were in lockdown for two months from late March.
In March alone, the carrier’s passenger traffic slumped more than a third from a year ago and was down 12.3% for the quarter, based on Aeroflot data published in April.
Aeroflot Group, which includes Russian flag carrier Aeroflot as well as Rossiya, Aurora and low-cost airline Pobeda, is 51.2% state-owned and has a Russian market share of almost 50% based on 2019 data.
($1 = 69.6900 roubles)
Reporting by Tatiana Voronova; Additional reporting by Gleb Stolyarov and Anastasia Lyrchikova; Writing by Katya Golubkova. Editing by Jane Merriman