27. 4. 96 Official Journal of the European Communities No L 104/25 (Acts whose publication is not obligatory) COMMISSION COMMISSION DECISION of 31 January 1996 concerning the recapitalization of the Iberia company (Only the Spanish text is authentic) (Text with EEA relevance) (96/278/EC) THE COMMISSION OF THE EUROPEAN COMMUNITIES, Having regard to the Treaty establishing the European Community, and in particular the first subparagraph of Article 93 (2) thereof, Having regard to the Agreement establishing the Euro- pean Economic Area, and in particular point (a) of Article 62 (1) thereof, ’ Having, in accordance with the provisions of the above- mentioned Articles, given notice to the parties concerned to submit their comments and having regard to those comments, Whereas: THE FACTS I The company Iberia Lineas Aéreas Espafiolas (Iberia LAE, hereinafter referred to as ‘Iberia’), which carried 13,6 million passengers in 1993, is by far the largest airline in Spain. It is controlled by the State holding-company Teneo which owns 99,85 % of the company’s shares. In addition to Iberia itself, there are the subsidiary airlines Aviaco, Viva and Binter which specialize in charter flights or operate on particular routes. At the end of 1993 Iberia employed 24 500 people and the four companies of Iberia, Aviaco, Viva and Binter owned a fleet of 177 aircraft (120 for Iberia alone). With a turnover of US$ 3,316 billion in 1993, Iberia occupies a mid-way position among European national airlines. The company network covers Spain and Europe, the Middle and Far East, North America and, above all, Latin America. Since the end of the 1980s Iberia has also acquired sizeable holdings in South American airlines: Viasa (45 %), Ladeco (35 %) and above all Aerolineas Argentinas (hereinafter referred to as ‘Arsa’) and its subsi- diary Austral. Iberia holds 30 % of the shares of Arsa and all the capital of the Argentine holding-company Inter- invest, which in turn owns 53,35 % of the shares of Arsa. On a par with Air France and Lufthansa, it also holds 29,2 % of the capital of the Amadeus computerized reser- vation system. In 1992 the Iberia group benefited from a State aid measure in the form of an injection of capital of Pta 120 billion, accompanied by a complete programme of restructuring and investment entitled ‘Strategic plan of the Iberia Group 1992-96’ (hereinafter referred to as ‘the strategic plan’). The strategic plan was ambitious in terms of the growth and development of Iberia. It was based on a good general upturn in traffic after the dramatic drop in activity witnessed in 1991 as a result of the Gulf War. In addition to increasing the market share held by Iberia it provided principally for the renewal of and increase in the company’s fleet and facilities; a reduction in personnel and better productivity; and the development of company activities, in particular towards Latin America, where Iberia had invested heavily between 1989 and 1991. The injection of capital was also designed to reestablish the ratio of debt to equity which had deteriorated appreciably. The return to profit was anticipated as from 1992.