Latvian government seeks Saeima's permission to join up to €30 million airBaltic financing
The cabinet wants the Saeima to authorize participation in temporary financing for airBaltic of up to €30 million, and also to extend the state loan repayment deadline to the end of the year.
After an extraordinary cabinet meeting on Friday, Transport Minister Rihards Kozlovskis said the government needs parliamentary approval to take part in the national airline's additional financing round. He stressed that this is not state aid, but rather a possibility to secure temporary funding ranging from zero to €30 million if needed.
The government also plans to push back the repayment date for the €30 million state loan from 31 August to 31 December, a move that likewise requires the Saeima's decision. In April, lawmakers had agreed to grant airBaltic a short-term unsecured loan of €30 million. By 24 July, the airline had repaid the principal and interest, totalling €12.9 million.
airBaltic's board has approved a business plan aimed at improving liquidity by raising €225 million in temporary financing backed by the existing collateral package for the 2029 priority bonds. The plan also calls for shrinking the planned fleet from 100 to about 40 aircraft by 2031. By the end of 2026, the company expects to operate around 36 Airbus A220-300 planes, down from the current 54.
In the longer term, the company plans to recapitalize by taking on €225 million in new debt and €100 million in fresh equity. A portion of the existing 2029 bonds would be converted into equity, with the remainder replaced by a smaller debt of up to €125 million.
In 2025, airBaltic's group revenue grew by 4.2% to €779.344 million, while its loss narrowed 2.7 times to €44.337 million. In the summer of 2025, Germany's Lufthansa became a shareholder. The Latvian state currently owns 88.37% of airBaltic, Lufthansa holds 10%, Aircraft Leasing 1 (owned by Danish businessman Lars Thuesen) has 1.62%, and others 0.01%. The company's share capital stands at €41.819 million.
Because of the 2025 financial performance and market conditions, airBaltic has suspended its possible initial public offering and no longer sees it as a potential source of capital in 2026.
