Grupo Aeromexico announced today that it has completed its financial restructuring process, officially exiting Chapter 11 of the U.S. Bankruptcy Act under which it voluntarily entered in June 2020 in the midst of the worst crisis in the airline industry unleashed by the COVID-19 pandemic.
The time elapsed since then meant going through a series of changes in the company’s structure and multiple negotiations with creditors, workers, and institutions.
See also: Aeromexico moves forward in its exit from Chapter 11 and prepares for a new stage of growth.
According to Aeromexico, the value of the capital after the restructuring is approximately USD 2,564 million. Apollo will retain a 22.4% stake, while Delta will hold 20%. The Mexican investor group will hold a 4.1% stake, while the remaining shares will be distributed among new investors and creditors.
The Baupost Group, Silver Point Capital, Oaktree Capital Management and other funds that were part of the ad-hoc group of creditors are also shareholders, after having invested approximately US$720 million in new capital.
Andrés Conesa, CFO Ricardo Sánchez Baker and Chairman of the Board Javier Arrigunaga will remain in their current positions.
The airline also reported that «key investors are funding new debt for the company’s exit by approximately US$762.5 million through new bonds issued in the United States. As a result, it has gained access to US$1.5 billion of the Restructuring Plan and related transactions».
See also: Aeromexico: Restructuring Plan Accepted by All Voting Classes of Creditors
CEO words
«Today is an incredibly exciting day for Aeromexico. We are ready to fly fast to new heights as we emerge from our Chapter 11 proceedings,» said Aeromexico CEO Andres Conesa.
«We are ready to begin a new chapter in our Company’s history, backed by a strong financial base, a solid capital structure, and investors who have full confidence in our future. Thanks to the dedication of Aeromexico’s family, as well as the support, trust, and empathy of our customers, unions, authorities, suppliers, and business partners, we have successfully completed this process. As we move forward, we will not only continue to modernize our company to make it even more sustainable, resilient and competitive, but we will also significantly expand our network and fleet. Meanwhile, we will be continuing to provide excellent service and maintaining our position as Mexico’s flagship airline,» he added.
The Mexican Airline Pilots Union Association (ASPA), through a statement, recognized those involved in this process, as well as Grupo Aeromexico’s 1,900 pilots and workers in general, who made the right decisions and supported the permanence of the source of employment.
Growth Plan and new capital
The Chairman of the Board announced that Aeromexico will expand its network and fleet to take advantage of the current situation in Mexico, which is currently one of the most profitable markets with the highest growth prospects globally post-pandemic.
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Throughout the restructuring process, Aeromexico has worked to sustainably expand its operations, opening six new routes, restarting service on more than 30 and increasing its total seat offering by more than 320% compared to June 2020 figures.
The company currently flies 84 domestic and international routes, connecting major Mexican cities such as Guadalajara and Monterrey with the European market via Madrid. In 2022, Aeromexico plans to continue to build on this momentum, including restarting services to London.
See also: Aeromexico resumes operations to London
Since 2021, Aeromexico has taken delivery of 31 aircraft and expects to receive 22 more over the course of 2022. By the end of this year, the company expects to have a fleet of 145 aircraft with an average age of seven years.
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Currently, its fleet consists of:
- 5 Boeing 737-700s.
- 36 Boeing 737-800s.
- 25 Boeing 737-8s, pending receipt of seven additional aircraft.
- 7 Boeing 737-9, pending receipt of nine additional aircraft.
- 8 Boeing 787-8
- 10 Boeing 787-9, pending receipt of four additional aircraft.
- 42 Embraer 190, operated by Aeromexico Connect.
Grupo Aeromexico also informed that they plan to invest approximately US$5 billion over the next five years in fleet and customer experience improvements.
