What is the new investor planning to do with Condor?

The state-backed holiday airline presents an investor who wants to take over the majority. Attestor has a three-step plan that includes new planes.

New investor found: a Condor aircraft

“Condorianer” – from the mouth of Friedrich Andreae, the word that the employees of the Condor holiday airline use sounds a bit bumpy. “I still have to practice that,” says Andreae. And there should be time for it. Andreae’s employer, the asset manager Attestor, becomes the new majority shareholder in the state-supported Condor. The contracts had been signed for just an hour when Andreae spoke about the continued existence of all 4050 Condor jobs.

The fact that the word Condorian is still bumpy should be forgotten by pilots and flight attendants. Many of them had probably never heard of Attestor either. Attestor has been around since 2012, the company was founded by the German Jan-Christoph Peters. Investments worth around 5.5 billion euros are part of the portfolio, according to the company.

Condor is the first aviation engagement for the London-based asset manager, who specializes in companies in transition. Andreae emphasizes that they are already active in the tourism sector. Attestor holds 12 percent of the car rental company Europcar Mobility Group and is the third largest shareholder there. Hotels in Italy and the Netherlands are also part of the portfolio.

Money for new planes

With 200 million euros in fresh equity, Attestor wants to take over 51 percent of Condor. The rest remains with SG Luftfahrtgesellschaft for the time being, which has managed the shares as a trustee since the conclusion of the Condor protective shield proceedings and has pledged it as security for an auxiliary loan to the state-owned KfW bank. Attestor has an option to take care of the rest. Attestor wants to contribute another 250 million equity to the renewal of the long-haul fleet, which is getting on in years.“The contracts are bindingly signed by all those involved, the jobs are secured,” said Condor boss Ralf Teckentrup, pleased.

Doubts had recently arisen again because the corona pandemic is dragging on longer than expected by Condor management. A 550 million euro auxiliary loan from KfW from April 2020, for which the federal government and the state of Hesse gave guarantees, was intended to bridge the toughest crisis phase.

Despite many savings efforts, it runs out after twelve months, 256 million euros had to be used to repay previous aid anyway. “A loan from the federal government and the state of Hesse is of a finite nature,” admits Condor boss Teckentrup. But bookings are currently picking up after a long lull. Talks with investors were sought, and contact with Attestor is said to have come about at the beginning of January.

“Three times knocked out”

Andreae sees the fact that Condor fits well into the portfolio, as evidenced by the fact that the management has not given up despite a series of setbacks. The airline was in distress in autumn 2019 due to the bankruptcy of the then parent company Thomas Cook. In a first bidding process, the Polish state aviation holding PGL, the parent company of Airline Lot, prevailed.

With the corona pandemic, Lot himself got into trouble and no longer wanted to hold on to contracts he had concluded. The long period of constraints was the next burden. “If you are knocked out three times and still stand, it shows the quality of the company,” says Andreae about Condor.

Despite the imminent inflow of capital, the state, which gave guarantees for auxiliary loans from the state KfW Bank, remains involved with Condor for the time being. “The federal government and the state continue to get involved, the KfW loan is being structured and adjusted,” said Condor CFO Christoph Debus, who was in charge of negotiating the investor agreement for the airline. How big the loan amount is, he leaves open. That also depends on the outcome of the aid approval by the EU Commission. But Condor will soon repay “a large part” of the previous loan.