Israel sets out conditions for alternative El Al financing scheme

El Al has reached a conditional agreement with the government on an alternative funding scheme, after the airline spent several months trying to negotiate a state-backed loan from local banks. El Al and its Sun D’Or airline operation have detailed the financing pact under which the Israeli state will pay $210m for the supply of flight tickets, in advance, for personnel in the country’s aviation security system. In return the two carriers will carry out flights for aviation security workers, to enable them to move between facilities, and bear the costs involved. An initial sum of 450m shekels ($136m) will be transferred to the company within two days of the agreement’s entry into force, El Al says. At the same time another 118m shekels will be placed in trust to meet obligations for pensions and severance pay to workers affected by new collective agreements, while the balance will be transferred once the company has made certain other payments to terminated employees.<br/>