U.S. Treasury begins distributing $15 billion in payroll support to airways By Reuters
© Reuters. FILE PHOTO: Delta Airlines planes are loaded and unloaded at Salt Lake City International Airport in Salt Lake City
By David Shepardson
WASHINGTON (Reuters) – The U.S. Treasury Department began distributing $ 15 billion in new payroll to airlines on Friday. These funds were provided by Congress to help more than 32,000 aviation workers get back to work by at least March 31.
Major airlines that receive assistance have to repay 30% of that in 10-year soft loans to the government. They must also issue warrants to the government as part of the assistance and agree to extend restrictions on executive compensation and the prohibition on paying dividends and share buybacks through March 2022.
Delta Air Lines (NYSE 🙂 expects total aid of 2.9 billion US dollars in this round, of which 830 million US dollars will be in the form of an unsecured loan. The airline announced it had received the first installment of $ 1.4 billion on Friday.
Southwest Airlines (NYSE 🙂 announced that it is expected to total $ 1.73 billion and $ 863.7 million on Friday.
The warrants will be priced at the closing prices of each airline on December 24th.
Congress approved separate wage and salary support of $ 25 billion in March.
A spokeswoman for the Treasury Department did not immediately comment.
SkyWest (NASDAQ 🙂 Inc said it will receive a total of $ 233 million under the program and received half on Friday.
Last month, American Airlines (NASDAQ 🙂 and United Airlines announced that they were calling back tens of thousands of employees on leave.
American and United put more than 32,000 workers on leave in October. The new support will keep these workers on the payroll through March 31st.
None of the airlines immediately announced how much they were expected to receive from the Treasury Department on Friday.
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