The government will be asked Tuesday to approve a bail out program for El Al

The government will be asked at its next meeting, which will probably take place next Tuesday, to officially approve the assistance to the company, in the amount of $ 400 million. In the draft decision-making proposal, the Treasury requests approval to purchase EL AL shares for $ 110 million in a public offering made by the company, in addition to providing it with a state guarantee for a loan of $ 250 million to be taken from the banks.
In the draft decision-making proposal, the Treasury requests approval to purchase EL AL shares for $ 110 million in a public offering made by the company, in addition to providing it with a state guarantee for a loan of $ 250 million to be taken from the banks.
The offer reads: "The amount of securities to be purchased by the State in a public offering shall be determined in accordance with the results of the said issue, to an extent not exceeding the said amount. The State shall sell or transfer the securities allotted to it within 24 months A special tenders committee in accordance with its authority, for the purpose of selling the said securities.
 "Until the sale of EL AL's securities, the state will not use the voting rights granted to it in respect of the securities allotted to it. The state will continue to have all the capital rights attached to the shares allotted to it. It will be clarified that this voting restriction will apply only to the state. Any third party will be entitled to full voting rights. "
 The Ministry of Finance attached to the draft decision-makers an explanation, according to which "since the beginning of the corona crisis in March, the decrease in cumulative international aviation activity at Ben Gurion Airport has been about 94%. In the last two months, % Of passenger traffic last year, while in Israel the recovery rate is much slower and stands at about 10% of the traffic that was in 2019.
 This makes it difficult for Israeli airlines to accumulate cash flow that will strengthen their economic situation and make it easier for them to cope with the crisis. In the coming years, great uncertainty is expected regarding the demand for flights. "The outline is expected to improve the company's financial position, including reducing the company's financial leverage, as well as increasing the company's cash flow by $ 400 million, which will allow the company to service its liabilities."