Turkish Airlines is looking for funding to prevent its collapse

Four sources told Reuters that the Turkish wealth fund is negotiating to provide emergency financing to Turkish Airlines, one of the companies most affected in the country by the Corona virus pandemic that has stopped all flights of the famous carrier.
The sources familiar with the matter added that the company, which flies to destinations around the world more than any other airline, may receive capital or financing support, although the final touches of anything have not yet been developed.It was not clear how much financing the Turkish wealth fund might provide for what a source described as a financial rescue.

Turkey’s wealth fund declined to comment.

In a statement to the stock exchange, Turkish Airlines said that the company had not received any information about talks on allocating liquidity or financing support to the company.

Movement restrictions in the wake of the Coronavirus pandemic have caused significant losses, layoffs, and shutdowns at airlines around the world.

German Lufthansa, one of the world’s largest airlines, agreed to a government financial bailout of $ 10 billion last June.

Turkish Airlines incurred 2.33 billion liras ($ 287 million) in losses in the second quarter, as the scope of general isolation measures expanded in the country and abroad.

It agreed with a union to cut wages between 30 and 50% until the end of 2021, but has avoided laying off employees.

One of the sources said, “It is very clear that Turkish Airlines needs a rescue program. It could be capital or financing support.”

The source added that the Turkish Wealth Fund conducted a wide study of Turkish companies that are experiencing difficulties in the transport and tourism sectors, indicating that further rescue operations may be imminent.

The fund owns 49.12% of Turkish Airlines, which have a market capital of 14.6 billion liras (1.9 billion dollars).

Its shares have fallen 31% since the borders were temporarily closed and international flights were halted after last February. Shares rose 2.5 percent on the funding news on Friday.

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