Global travel site Booking.com drew an outcry after Chief Executive Officer Glen Fogel told newspaper De Volkskrant on April 15 that it was applying for government help, despite the fact that the company has huge cash reserves and is still paying billions of dollars to shareholders.
Booking.com, which has around 5,500 employees in the Netherlands, said it was working hard to support its employees and cope with a “decimated” travel market.
“Most major companies have announced major layoffs, but we are doing absolutely everything we can to weather the storm,” the company said. It added it may raise capital in public markets and impose a hiring freeze.
Parent company Booking Holdings Inc. has bought back $16 billion worth of stock over the past three years, according to its financial statements. Booking Holdings had $6.3 billion in cash on its balance sheet on Dec. 31, according to its annual report. It also had $7.6 billion of debt.
The Dutch government plans to tighten the rules for businesses claiming coronavirus relief. Under the country’s rescue plan, a company could ask the government to pay as much as 90% of its staff wages for three months if revenue has fallen by more than 20% due to the coronavirus.
Dutch Prime Minister Mark Rutte told members of parliament on Wednesday that companies applying for a second round of financial help from June should stop paying shareholders and forfeit management bonuses in the near future.
Netherlands mixes a strong welfare state with a liberal economic tradition and some of Europe’s lowest effective corporate tax rates.
Founded in 1996, Booking.com was acquired in 2005 by Priceline, becoming a U.S. company by law, while retaining most of its activity in the Netherlands.