Respite for the Brazilian airline Azul. The company reported this Tuesday that it had reached a commercial agreement with aircraft lessors and original equipment manufacturers (OEM), which will allow it to reduce its liabilities and avoid an eventual reorganization – as had been rumored – under Chapter 11. in the United States. According to the firm, the agreement was reached with those who own 92% of the existing share issuance obligations, so negotiations will continue with the remaining 8% in the coming days, “as well as with other interested parties.”
“These agreements represent an important part of a comprehensive plan designed to strengthen Azul’s cash generation and improve its capital structure in the future. Under these agreements, the lessors and OEMs agree to eliminate their pro rata share of the current balance of the obligations of issue of shares for a total of approximately 3,000 million reais (about 547 million dollars) and, in exchange, they will receive up to 100 million new preferred shares of Azul in a single issue,” Azul explained in a statement.
The troubled airline had already been in talks with its creditors and other industry players to address its short-term debt obligations, which ranged from a stock offering to contemplating bankruptcy.
