LATAM Airlines submits new refinancing plan to U.S. courts
LATAM Airlines has presented a new financial refinancing plan after its initial proposal was not approved by the U.S. courts, which rejected it because they understood that the creditors of one of the restructuring tranches could benefit through the subscription of shares as a form of credit payment, reported EuropaPress
The airline analyzed Judge James L. Garrity’s decision with its legal and financial advisors and has prepared a new revised proposal that eliminates this clause.
Specifically, LATAM’s new plan maintains the initial financing commitment of up to $2.45 billion through a deferred term credit line composed of two tranches, A, for an amount of capital of up to $1.3 billion; and C, for an amount of up to $1.15 billion.
Of the total amount of tranche A, $1.125 billion would be provided by Oaktree Capital, while the remaining $175 million would be distributed by Knighthead and Jefferies.
For its part, of the total amount of tranche C, $ 750 million would be provided by shareholders of LATAM, including the Cucto Group, Eblen Group and Qatar Airways, among others. In addition, 250 million dollars would also be provided by Knighthead and Jefferies, in addition to other entities, and the remaining 150 million dollars would be provided by creditors of the company or new investors of the same.
With regard to the creditors of this section, highlights the absence of the Amaro family, which was in the original proposal along with the Cueto and Eblen, in addition to Qatar Airways.
“If no commitments are obtained for these 150 million dollars, the differential will be provided, on a pro rata basis, by the creditors of the indicated Tranche C,” explains the general director of LATAM, Roberto Alvo.
Likewise, the new refinancing proposal contemplates an eventual additional Tranche B for up to 750 million dollars, subject to court approval and other conditions.
The restructuring, if approved, would have a scheduled maturity of 18 months, subject to a possible extension of 60 additional days.
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