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France's Renault reaches deal on 5 billion euro state-backed loan - sources

Published 19/05/2020, 17:14
Updated 19/05/2020, 17:15
© Reuters. Renault ramps up production at its factory of Flins, near Paris

© Reuters. Renault ramps up production at its factory of Flins, near Paris

PARIS (Reuters) - French carmaker Renault (PA:RENA) has sealed a deal with banks on a 5 billion-euro (4.46 billion pounds) state-guaranteed loan to help the company to cope with the coronavirus outbreak, two sources close to the matter told Reuters on Tuesday.

The state-guaranteed loan, which Renault had been working on for about a month, should be submitted shortly to the board of directors, the sources said, before being approved formally by the economy ministry.

A Renault spokesman was not available immediately for a comment.

The firm, which posted a loss in 2019 and had been struggling with faltering demand before the pandemic, has already flagged it would seek state aid through this format, in a bit to shore up its liquidity.

© Reuters. Renault ramps up production at its factory of Flins, near Paris

Other companies such as Air France KLM (PA:AIRF) have also secured bailout deals through state-backed loans, which are funnelled through commercial banks.

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