European Union regulators have approved a Greek state grant of EUR120 million euros (USD146 million) to privately owned flag carrier Aegean Airlines (A3, Athens), judging it to be in line with the bloc's state aid rules revised for the coronavirus era.

The sum of the direct grant is proportionate and does not exceed the estimated damage caused to the airline between March 23 and June 30, the European Commission said in a statement on December 23.

The pandemic qualifies as an exceptional occurrence, as it has been an extraordinary, unforeseeable event having a significant economic impact, so Athens’ exceptional interventions to compensate for the damages linked to the outbreak are justified, the European Commission argued.

“This measure will enable Greece to compensate Aegean Airlines for the damage directly suffered due to the travel restrictions necessary to limit the spread of the coronavirus. We continue working with member states to find workable solutions to support companies in these difficult times, in line with EU rules,” antitrust chief Margrethe Vestager explained.

Aegean Airlines carried about 15 million passengers in 2019. Before the outbreak, it operated from Athens and other Greek airports to 155 domestic and international destinations in 44 countries. Today, according to the ch-aviation capacities module, it operates 150 weekly frequencies to 29 destinations in 44 countries.

The airline underlined in its own statement that the measure is part of an overall agreement in which the grant is conditional on the airline successfully effecting a private investor share capital increase of EUR60 million (USD73 million).

Additionally, the Greek state will receive free stock warrants exercisable at any time between two and five years after the disbursement of the aid funds “so as for the Greek state to benefit from any future upside in the share value of the company,” the carrier said. The warrants would have rights to acquire shares representing 11.5% of the company’s common shares.

Aegean Airlines aims “to complete all necessary procedures within the first three to four months of 2021,” its statement concluded.