France Builds 20-Billion Euro Fund to Help Recapitalize Big Companies
The French government has set aside 20 billion euros ($21.7 billion) to help inject capital into big companies struggling to survive the CCP virus crisis, Finance Minister Bruno Le Maire said on April 10.
Le Maire has repeatedly pledged to help France’s corporate champions get through the CCP (Chinese Communist Party) virus crisis by taking stakes in them or even going as far as nationalization if necessary.
“We’ve decided to put credit on the fund, to put 20 billion euros on the special fund to support to the capital of companies that need it, whether public or private,” Le Maire said on Europe 1 radio.
The funds are earmarked in a package of crisis measures that Le Maire more than doubled on Thursday to 100 billion euros and which is set to go to parliament next Wednesday for approval.
First on the list of companies that may need state funds is Air France KLM, which said on Thursday it expected the French and Dutch states to help meet its cash needs with air travel at a standstill.
“As regards Air France, we are ready for when the time comes, without a doubt soon, to support Air France and make sure that this French industrial champion … recovers quickly,” Le Maire said.
Sources have told Reuters that Air France-KLM is in talks with banks to receive up to 6 billion euros ($6.56 billion) in loans guaranteed by the French and Dutch governments, a sum which the junior transport minister has described as “not unrealistic.”
Meanwhile, other companies whose business activity has ground to a halt are seeking to tap bank credit first rather than rushing to the state for new capital.
Renault Chairman Jean-Dominique Senard said on Friday that the carmaker, in which the French state has a 15 percent stake, could seek bank loans worth 4-5 billion euros ($4.37-$5.47 billion) .
