BRUSSELS (AP) - The European Union's antitrust authority on Tuesday approved the Polish government's 200 million-euro ($270 million) bailout for its ailing national carrier, LOT airlines.
BRUSSELS (AP) — The European Union's antitrust authority on Tuesday approved the Polish government's 200 million-euro ($270 million) bailout for its ailing national carrier, LOT airlines.
The 28-nation bloc's executive Commission said the assistance does not violate EU rules limiting state aid to businesses since it will "allow the company to become viable in the long-term without unduly distorting competition."
Star Alliance member LOT has been in financial difficulty for several years. In May 2013, the EU approved a 100 million-euro government rescue loan in exchange for a restructuring plan meant to offset any competitive advantage. In the plan, the airline discontinued some profitable routes and reduced capacity to trim costs. The Polish government then proposed the 200 million-euro capital injection to help LOT regain its long-term viability by 2015.
EU antitrust chief Joaquin Almunia said LOT's "restructuring plan should make it a viable company in the near future."
The airline's CEO, Sebastian Mikosz, said it was a "very important day for LOT."
He said the restructuring plan ensured the airline's longer-term survival by cutting costs and improving revenues, allowing LOT to register a net profit in 2013 — the first in years.
LOT was Europe's first airline to have Boeing 787 planes and says the fuel-efficient models have helped cut costs.