Annual report: Nordica?s partnership with Adria Airways ended in a loan | Business | ERR
So Adria have been very close to insolvency... I can't imagine a new business like Nordica wouldn't have rather been given its money :-(
For a year following the foundation of NAG as the successor of bankrupt Estonian Air, Adria Airways was the new state carrier’s most important partner, providing a booking system as well as operational services.
“One of the advantages of this cooperation model was the placement of advance payments and deposits in the partner’s accounts, covering their running costs and potential business risks,” Uibo said. “When the partnership ended in 2016, a part of Nordica’s liquid assets in Adria [Airways] was converted into a loan with an agreement of both sides.”
The result was a debt of Adria Airways to Nordica in the form of a cash debt converted into a loan in the amount of €4.556 million, listed in Nordica’s annual report under “Other receivables”.
The thing that intrigues me... does this count as state aid under EU rules? It's effectively a loan from the Estonian Government.