Unpacking the Controversy: How Air Europa Secured Financing from SEPI Amidst Pandemic Challenges

In November 2020, Air Europa signed a public financing contract with the State Company for Industrial Participations (SEPI), which was crucial in helping the airline survive the challenges posed by the Covid-19 pandemic. The aid, amounting to 475 million, was the largest granted by the Fund to Support the Solvency of Strategic Companies (FASEE). However, allegations have been made linking President Pedro Sanchez’s partner, Begoña Gomez, to favorable treatment towards Air Europa in securing public support. These allegations have been refuted by members of the Executive and a complaint has been filed against Begoña Gomez for alleged influence peddling, which is currently under investigation.

The President has responded to these allegations by suspending his agenda and considering a possible resignation. The SEPI demanded extensive guarantees from the Hidalgo family, owners of Air Europa, to secure the public funds. The conditions of the loans included fixed and variable interest rates with strict repayment terms. Additionally, SEPI’s involvement in Air Europa’s management includes representation on the company’s board and approval for key decisions relating to its operations. The SEPI has significant influence on important matters such as financial transactions, sales of assets, and collaboration agreements.

Despite facing tough challenges and financial struggles that necessitated close oversight from the government to ensure its survival, Air Europa managed to sustain its operations with support from other financing sources alongside SEPI’s aid. The future of Air Europa and its partnership with SEPI remains crucial for the aviation industry in Spain.

The audit and evaluation process of Air Europa’s eligibility and viability plans were thorough. The SEPI demanded extensive guarantees from Hidalgo family owners of Air Europa to secure public funds.

The conditions set forth by SEPI included fixed interest rates along with variable rates that had strict repayment terms.

While there were challenges faced by Air Europa during this period; it sustained its operations thanks to support from other financing sources including those provided by SEPI.

Air Europa’s future as well as its relationship with SEPI are vital for maintaining stability within Spain’s aviation industry.

In conclusion, despite facing several obstacles due to Covid-19 pandemic; Air Europa was able to survive thanks in part to support from state-owned enterprises such as SEPI through funding aimed at keeping them afloat during tough times. While controversy surrounding potential favoritism towards certain companies still lingers; it is clear that without such assistance many businesses would have failed during this unprecedented crisis period.