What Condor’s Future Could Look Like Without Polish Buyout

Now that LOT Polish Airlines owner the Polish Aviation Group (PGL) has decided to withdraw from its agreement to purchase German leisure airline Condor, what options are still available for the troubled carrier?

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The coronavirus has killed PGL buying Condor. Photo: Condor

Back in January, before the gravity of the COVID-19 pandemic became a reality, PGL thought it was getting a good deal by becoming Condor’s sole shareholder once it had paid back a €380 million ($418m) bridging loan to the German government. The loan from the government and the central German state of Hesse was given to the Frankfurt-based carrier to allow them to keep operating, following the collapse of Condor’s parent company Thomas Cook.

It is interesting here to note that while the German government stepped in to help protect the loss of jobs, the United Kingdom did nothing to help Thomas Cook. This, in effect, set a precedent for when Exeter-based Flybe asked for help; it too was left to go under.

COVID-19 is to blame for PGL pulling out of the deal

With European air travel at a virtual standstill, it is easy to see why PGL wanted to pull out of the deal. Without citing a reason or naming the coronavirus as the catalyst, a spokesperson from the Polish airline’s parent company says it has told Condor that it is withdrawing from buying the leisure carrier.

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The German government gave Condor money to help save jobs. Photo: Condor

According to FlightGlobal, a PGL spokesperson commented,

”We are currently in discussions with PGL to define possible conditions for a withdrawal,” the spokesperson says. ”We are also examining how we will assert our claims under the signed purchase agreements.

”Condor is prepared for this scenario and intends to leave the protective shielding proceedings soon,” the spokesperson adds. ”There are various options for the future ownership structure, such as a trustee structure. We are also in talks about state aid because of the effects of the coronavirus crisis.”

Condor is now carrying cargo

For its part, Condor says that it will continue as best it can.

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Condor is now carrying vital medical supplies. Photo: Condor

FlightGlobal quotes a Condor spokesperson with saying:

“At present, we are concentrating, in particular, on cargo and harvest aid flights in order to contribute to Germany’s basic medical and goods supply,” the spokesperson says.

What now for Condor?

Given the current circumstances, and the economic hardship, the coronavirus pandemic is wreaking on the world’s economies, the only real hope Condor has is another lifeline from the German government. Having already given the airline money in the past so that they could keep operating, it is hard to imagine them not doing it again. In the short term, nationalizing Condor is probably the only option until a buyer can be found once things return to normal.

How long this might be is anybody’s guess, but with governments around the world shelling out billions in state aid, what Condor needs to keep flying is a drop in the bucket.

What do you think will happen to Condor? Please let us know your thoughts in the comments.

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