U.S. Court approves Avianca to arrange financing to get out of bankruptcy.
The airline Avianca Holdings received from a U.S. court the approval of letters of commitment to carry out the necessary financing to emerge from Chapter 11 of the Bankruptcy Law, the company announced on Tuesday.
With the authorization, Avianca will request an amendment to include two new tranches of loans or notes, which will refinance in full its obligations under “Tranche A” for US$1.4 billion, Reuters reported.
See also: Avianca resumes direct route Bogotá-Asunción in September.
“The Letters of Commitment that were approved today by the Court represent the first tangible result of the marketing process Avianca undertook in search of its exit financing, which began in April 2021,” Avianca specified in the communication to the Financial Superintendency.
According to the document, the refinancing will provide approximately US$220 million of additional liquidity and will be converted into long-term debt financing upon Avianca’s emergence from Chapter 11, subject to the satisfaction of certain conditions.
In April, the airline had estimated it would emerge from its Chapter 11 restructuring process this year.
By Nelson Bocanegra, Edited by Juana Casas.
Photo: Dylan Agbagni/Wikimedia
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