February 25 (SeeNews) - Romanian flag carrier Tarom said on Tuesday that it will seek restructuring aid based on a three-year plan it will submit in the following months.
"In the coming months the company will submit a restructuring plan and will undertake the necessary steps for its approval and for obtaining a restructuring aid. The implementation of the efficiency measures will transform the company into a modern and efficient passenger-oriented company in three years," Tarom said in a press release.
The company did not elaborate on the restructuring plan.
On Monday, the European Commission approved, under EU state aid rules, Romania's plans to grant a loan of some 36.7 million euro ($38.9 million) to Tarom for up to six months.
According to Tarom, the rescue aid is just the first step towards improving the company.
"The measure will help ensure continued operations of the company, especially on the many routes where Tarom is the only supplier and will help avoid disturbances for passengers, without distorting competition on the single market," the company said.
Tarom is operating on international and domestic routes with a fleet of 25 aircraft - seven ATR-42-500, two ATR-72, 4 Boeing 737-700, 4 Boeing 737-300, 4 Boeing 737-800 NG, and 4 Airbus A318-111.
Tarom narrowed its net loss to 171.4 million lei ($39 million/ 36 million euro) last year, from 182.7 million lei in 2018. Tarom's 2019 turnover is estimated at 1.51 billion lei, up from 1.4 billion lei in 2018, according to preliminary data published by the company in Romania's official gazette.
Last year was Tarom's 12th straight year of annual loss.
($= 0.9244 euro)