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Lufthansa on Thursday said it is negotiating a E9b "stabilisation package" with Germany's Federal Economic Stabilization Fund. The bailout includes a non-voting capital component, known as a so-called silent participation, a secured loan, and a capital increase which may leave the German government with a shareholding of up to 25% plus one share, the company said. "The Executive Board of Deutsche Lufthansa AG is continuing negotiations with the aim of ensuring the future viability of the company for the benefit of its customers and employees," the company said in a regulatory statement. Various alternatives of a capital increase are being discussed, including an increase at the nominal value of the share, if necessary after a capital cut, Lufthansa added. As a condition of the bailout, Lufthansa may have to waive future dividend payments and provide supervisory board representation for members of Germany's stabilisation fund, the company said.<br/>

United is sweetening the yield on a $2.25b junk-bond sale after investors expressed concerns about the aging fleet pledged as collateral, according to people familiar with the matter. The airline is offering a yield of 11%, which was increased from initial discussions in the low 9% range for the deal, said the people, who asked not to be identified discussing a private transaction. The changes come after the three and five-year bonds had only received about $1.5b of orders as of Thursday morning, the people added. Investors have so far proven eager to lend to companies that have been hit hard by the coronavirus pandemic. But the pushback on United’s deal suggests they still have their limits, and may be reluctant to jump in without the double-digit yields and iron-clad collateral seen in previous offerings. The company has also added a clause that would trigger repayment of the bonds at a substantial premium to par, known as a make-whole, if the company files for bankruptcy, the people said. “This is a good example of a firm being creative in financing unencumbered assets,” said John McClain, a money manager at Diamond Hill Capital Management.<br/>

Singapore Airlines expects to make a full-year net loss for the first time in its history as the coronavirus continues to hammer the global aviation sector. The SIA Group, which comprises national carrier SIA, regional arm SilkAir and budget carrier Scoot, said in a Singapore Exchange update on Friday that the forecast is despite "strong results" in the first nine months of the financial year that ended in March 2020. A small operating profit is still expected for the full year, the airline added. Operating cash flows are expected to remain negative in the April to June quarter, with the Covid-19 pandemic not showing any definitive signs of abatement. The full results for the year will be announced on May 14. Making the announcement on the back of capacity cuts that will last until the end of June, the SIA Group said its financial situation has been worsened by the collapse of fuel prices in March, which led to fuel hedging losses. Only 4% of SIA and SilkAir planes are still flying, and just 2% of Scoot planes are expected to take to the skies in the next two months. The airline said: "The timing of any recovery from the Covid-19 crisis and its trajectory remain uncertain. During this time, the SIA Group continues to pursue steps to reduce costs and conserve cash, and proactively build liquidity and strengthen our balance sheet."<br/>

Singapore Airlines Group says its financial exposure to Virgin Australia is limited and it is not obliged to inject capital. “On the recent announcement of Virgin Australia entering into voluntary administration, the SIA Group has no requirement or obligation to provide capital to Virgin Australia,” it said Friday in a trading update. “We have been equity accounting for our share of losses in Virgin Australia. As at 31 December 2019, our carrying value was zero and we have no exposure to further losses incurred by the company. We have no outstanding loans to the airline.” Virgin Australia announced on 21 April that it was entering voluntary administration. Administrator Deloitte said on 30 April, after the first creditors meeting, that the airline expects to receive binding offers in June and is confident of achieving a sale by month-end. SIA Group’s latest FY 2019 report shows that the carrying amount of its investment in Virgin Australia was S$315m as at 31 March 2019. This encompassed a S$190m share of Virgin Australia’s net assets.<br/>

Portugal’s flag carrier TAP resumed some of its international operations on Thursday with a flight to London as lockdown measures imposed to combat the spread of the coronavirus are slowly being lifted in the tourism-dependent country. A flight to London Heathrow took off at around 3 p.m. (1400 GMT) according to the Lisbon airport departures webpage, and the British airport listed it as due to land at 1645 GMT. There is another flight from Lisbon to Heathrow scheduled for Sunday, according to TAP’s website that also showed a scheduled flight to Sao Paulo in Brazil on May 14. TAP is expected to operate a flight from Lisbon to Paris on Friday morning, the Lisbon airport website showed. A plan shared on TAP’s website on May 5 but later deleted had revealed flights from Lisbon to London and Paris would take place twice a week until the end of May.<br/>

Air NZ jet pilots have forged a deal which sees them take a 30% pay cut and limits the number of job losses to around 300. The New Zealand Air Line Pilots' Association (NZALPA) says it has saved as many jobs as possible. About 900 Air NZ jet pilots will remain on the payroll but will take what equates to a 30% pay cut for the next nine months. They will continue flying the airline's jet aircraft on domestic and international routes with significantly reduced schedules. Some captains make a basic salary of around $330,000 with flying pay and other allowances on top of that. Association president Andrew Ridling said pilots had faced an uncertain path following the dramatic cuts to the airline's schedule. It is flying around 95% fewer services than this time last year although will increase some domestic services when the country drops down to level 2. "We'd been in talks with Air New Zealand for a number of weeks to save as many pilots' jobs as possible and ensure a fair process for getting other pilots back in the air once the recovery gets underway," said association president Andrew Ridling. "Sadly, almost 300 of about 1200 of our Air New Zealand jet pilot members are being made redundant this week (some taking voluntary redundancy) or are accepting early retirement."<br/>

Ethiopian Airlines Group has almost doubled its cargo capacity and deferred two months of plane-lease payments to help navigate the aviation crisis caused by the Covid-19 outbreak. Africa’s biggest airline has converted 11 passenger planes to transport goods, adding to an existing fleet of 10 Boeing Co. 777 and two 737 freighters, CEO Tewolde GebreMariam said. The state-owned carrier has added new cargo destinations in South America, China and Europe and is transporting two planes of cut flowers to the latter continent every day. “There are new opportunities that are emerging due to the huge investment we have done -- we have huge cargo capacity,” the CEO said. “Under the circumstances, Ethiopian Airlines is doing well.” Ethiopian is on track to lose almost $1 billion in ticket sales in the 12 months through June thanks to the grounding of almost all its passenger flights, but it hasn’t yet needed to call on its state owner for direct funding despite vocal government support. “The survival of this airline is key for Ethiopia,” PM Abiy Ahmed said last week. “Ethiopian Airlines is our connection to the outside world. It is our port, it is our Red Sea, it is our ocean.”<br/>

South Africa’s government is urgently trying to extend the period of operations for South African Airways after the carrier’s business rescue practitioners warned that 8 May would amount to a “drop dead” day when all flights would cease. The country’s public enterprises minister, Pravin Gordhan, outlined to a parliamentary committee on 6 May that a new airline was in the planning stage – although he gave few details – but indicated friction between the government and unions on one side and the practitioners on the other. “We need to find some quick answers,” said Gordhan, referring particularly to a need to extend SAA’s operations. He told the committee that meetings over finances were due to take place in an effort “give continuity” beyond 8 May. “We also want to indicate there should be no fire-sale of important assets of SAA or a move towards liquidation,” he added. If the practitioners pursue a wind-down process, said Gordhan, it would not achieve the original objective set by the government for a business rescue.<br/>

The first of the 64 Air India and Air India Express flights bringing back stranded Indians will arrive in Kerala from the Gulf with 354 people. The Air India Express flight to Kochi will take off from Abu Dhabi at 4.15 pm and reach its destination at 9.40 pm, while the other to Kozhikode is scheduled to leave Dubai at 5pm and arrive at 10.40 pm, officials said. No flights to Calcutta have been slotted till now. This means that anyone looking to return to the city will have to be ready to go into quarantine for 14 days in the destination where the Air India flight lands. The first batch of passengers travelling by Air India will reach New Delhi from Singapore on May 8, according to the airline’s evacuation schedule. Flight AI-381 from Singapore will reach New Delhi at 11.35am on Friday. The carrier will operate two flights from Riyadh and Dhaka on Friday, which will land at Calicut and New Delhi, respectively. The flight from Singapore has the capacity to carry 250 passengers, an Air India official said. Most of the Air India flights will land in Delhi and Mumbai with some heading for Hyderabad, Chennai and Bangalore.<br/>

Stress has been mounting for Latin American airlines as carriers brace for a slow recovery from the coronavirus pandemic, but Brazil’s government on Thursday reduced the loan aid available for carriers, while Panama’s Copa Airlines said it did not need a bailout. “We’re not requesting nor are we expecting any aid from the government,” Copa CE Pedro Heilbron told analysts on Thursday. “I think the government has bigger issues to deal with.” In Brazil, a source familiar with government discussions said that the country’s BNDES state bank had shrunk by a third the loan aid available for Brazil’s top three carriers to 6b reais ($1.03b). The Brazil CEOs for carriers Gol Linhas Aereas Inteligentes, LATAM Airlines Group and Azul SA have pushed for government loans that they see as essential. They had been hoping for 3b reais in available aid for each company within Brazil. The contrast in messaging between Copa and Brazil’s carriers highlight the differences in their financial health. While Copa could have distributed a dividend this year, flying in Brazil almost always leads to a loss for its airlines. In Panama, Copa has reinforced its liquidity privately, most recently with a $350 million bond offering in late April, part of a plan to build a “fortress” of cash,” Heilbron said. It added it was planning to retire early its fleet of 14 older Boeing 737-700 NG planes, the latest carrier to do away with planes due to the coronavirus crisis. <br/>