Brazil airline Azul ready to raise capital after debt deals - CEO
Reuters
Published Jun 13, 2023 02:11PM ET
Updated Jun 13, 2023 02:21PM ET
By Gabriel Araujo
SAO PAULO (Reuters) - Brazilian airline Azul is ready to raise additional capital, its chief executive said in an interview, after reaching deals with lessors and bondholders to postpone debts maturing in the near term under a broad restructuring plan.
John Rodgerson told Reuters the additional cash would help Azul to "grow again" as it plans to open new routes this year.
Azul launched on Tuesday exchange offers aimed at pushing bonds set to mature in 2024 and 2026 to 2029 and 2030, respectively, following a deal with aircraft lessors to give them equity and tradable debt in exchange for lower payments.
"Now, with all our debt renegotiated and moved forward, we are ready to raise new capital," Rodgerson said. "No one wants to give you money to pay old creditors. They want to give you money to help you grow again."
Azul is evaluating the market before providing details of any transaction, but the CEO said it could come "at any moment" and confirmed that loyalty program TudoAzul and its cash flow could be pledged as collateral.
Rodgerson had floated that possibility in a press conference earlier this year, following similar moves by U.S. carriers Spirit and Hawaiian, touting it as "much better" collateral than the airline itself.
As strong demand is set to drive record revenue this year, Azul plans to open 10 to 15 new routes in Brazil by year-end in addition to recently added international routes to Paris and Curacao, Rodgerson said.
"People like talking about the 'sexy' international routes but we see a lot more opportunities in Brazil," he said. "You only have a flight to Paris because you're also serving rural Pernambuco state."
Shares of Azul have gained 70% year-to-date but are still well below their pre-pandemic highs. Rodgerson hopes the recently announced exchange offer will help remove an overhang on the stock.
Get The News You Want
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.