Air Canada, struggling with the collapse of air traffic due to the COVID-19 pandemic, reported Monday that it reached agreement on a long-awaited aid package with the government that would give it access to up to C$5.9 billion ($4.69 billion).
See also: JetBlue Reveals Plans to Reinvent What It’s Like to Fly in ‘Economy’ Across the Atlantic.
The package consists of a series of debt and equity financing agreements with the Canadian government, the airline said in a statement.
Under the terms of the deal, the government will be able to buy C$500 million worth of shares in the airline.
See also: United Airlines plans hire and train 5,000 pilots by 2030.
Air Canada can borrow C$1.5 billion in the form of a secured revolving credit facility at a 1.5% premium to the Canadian Dollar Offered Rate and a further C$2.475 billion in the form of three unsecured non-revolving credit facilities of C$825 million each, Reuters reported.
Air Canada and rival WestJet had pleaded for help for months as demand plummeted. Ottawa resisted, demanding the airlines restore some of the regional routes they had cut and promise to refund passengers who could not take flights they had booked.
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