Government clears El Al support as Israel heads for new lockdown

Israel’s government has approved the decision to provide assistance to El Al, adding that its share acquisition will be conducted in a manner such that the state does not exceed a 44.9% stake in the airline. El Al is planning to issue 753.3m shares to raise urgent funding amounting to 505m shekels ($145m). The government has sent a formal communication to El Al approving the measure and detailing the conditions for its participation. Tel Aviv’s stock exchange director has also approved the listing. El Al will receive notice from the government, shortly after receiving the results of the offering, relating to the manner in which securities will be allocated to the state to account for any difference between the target and the amount raised. The government says the state will sell its shareholding within 18 months of the public offering. The share issue will be complemented by a state-backed $250m debt. While the government says it “prefers” this debt be raised through a bank loan, it adds that – if no agreement can be reached with banks – it will allow El Al to raise debt in an “alternative manner”, including bonds.<br/>