Azul Cuts Debt, Secures Capital, and Plans 2025 Expansion Ahead of GOL Merger
Azul Linhas Aéreas has finalized an agreement with lessors, manufacturers, and creditors, achieving a significant reduction in financial obligations. The restructuring includes debt conversion and a new capital infusion, strengthening the airline’s position for future growth.
On Tuesday, the 28th, Azul Linhas Aéreas announced the successful completion of a key financial restructuring process, eliminating more than $1.86 billion in debt and financial obligations. This move is part of the airline’s strategy to strengthen its position and adapt to an increasingly competitive market.
Debt Conversion and Capital Injection
As part of the agreement, Azul converted financial instruments into $560 million in preferred shares and renegotiated $780 million in debt, now set to mature in 2029 and 2030. Additionally, a $525 million capital infusion has improved the airline’s short-term cash flow and reduced its leverage by 1.4x, according to pro forma figures from Q3 2024.
Overcoming Market Challenges
Throughout 2024, Azul faced multiple external challenges, including the devaluation of the Brazilian real against the U.S. dollar, high operational costs due to rising aviation fuel prices, and global supply chain disruptions. Further complications arose from flooding in Rio Grande do Sul and an increase in legal disputes within the sector.
Despite these challenges, Azul successfully negotiated with investors and commercial partners, restoring market confidence and reinforcing its financial stability, according to reports from Aeroin, a partner media outlet.
CEO John Rodgerson: “A Stronger, More Resilient Azul”
Azul CEO John Rodgerson emphasized that this restructuring marks a major milestone for the airline:
“This process makes Azul stronger and more resilient. Eliminating R$11 billion in financial obligations, along with the new capital investment, ensures we are better prepared for the future.”
Rodgerson also confirmed the arrival of 15 new Embraer E2 aircraft in 2025, a key development to expand air connectivity across Brazil and enhance customer experience. He expressed gratitude to investors and partners who supported Azul’s financial transformation.
AUTOR
AEROIN es el medio líder de aviación en Brasil, y uno de los más leídos del mundo, con el que Aviacionline posee un acuerdo de intercambio editorial. https://www.aeroin.net
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