- Air New Zealand (AIZ) has landed a NZ$900 million (approximately A$891 million) loan from the New Zealand Government
- Like many other tourism stocks, New Zealand’s national airline is struggling financially amidst the COVID-19 pandemic
- As part of the loan agreement, the company has cancelled its interim dividend
- New Zealand’s Finance Minister Grant Robertson said without this intervention, New Zealand was at risk of not having a national airline
- Air New Zealand shares, which have been in a trading halt all week, have dropped 33.4 per cent to trade at $1.04 apiece
Air New Zealand (AIZ) has landed a NZ$900 million (approximately A$891 million) loan from the New Zealand Government.
Like many other tourism stocks, New Zealand’s national airline is struggling financially amidst the COVID-19 pandemic.
As part of the loan agreement, the company has cancelled its interim dividend.
The loan will help the airline draw down on funds if its cash reserves drop below a minimum threshold, providing additional funding.
As the national airline, Air New Zealand has a unique and critical role in the New Zealand economy.
“Without this intervention, New Zealand was at risk of not having a national airline,” NZ’s Finance Minister, Grant Robertson said.
Last week, the airlines cheif executive Greg Foran revealed plans to cut a third of his 12,500 staff.
Greg said weekly flights were already down from 3600 to just 1500, with further falls to come.
“The airline is going to be a little smaller than what it was when we went in because there will be a little bit of time before the demand returns,” he said.
“We’re going to get through this. I’m very confident of this,” Greg told the media on Friday.
Air New Zealand shares, which have been in a trading halt all week, dropped 33.4 per cent to trade at $1.04 apiece at 12:51 pm AEDT.