Following early signs of a recovery of the worldwide air traffic, combined with an improved access to capital markets, Air France-KLM has agreed with the syndicate of the nine banks of the PGE and the French State to redeem €500 million of the outstanding bank loan notional, bringing it down to €3.5 billion and, concomitantly, to amend its redemption profile by substituting the single repayment initially due on May 6, 2023 with a new maturity on May 6, 2025, at the latest, at Air France-KLM’s discretion.
The new maturity schedule is changed to: In May 2023: partial redemption of €800 million, which leads to an outstanding amount of €2.7 billion; In May 2024: partial redemption of €1.35 billion,
which leads to an outstanding amount of €1.35 billion; In May 2025: final redemption of €1.35 billion. No more outstanding amount further.
Air France-KLM has described this partial redemption combined with the now amortized redemption profile of the PGE as a “new milestone on the restructuring path of the debt profile and of the balance sheet of the Group Air France-KLM, following the €1 billion capital increase and the conversion of a €3 billion French State loan into 3 perpetual bonds in April 2021, the issuances of €800 million dual tranches senior bonds in July 2021 as well as the EMTN (Euro Medium Term Notes) program in September and the solicited ESG rating obtained from Standard and Poor’s in October”.
The airline stated that discussions are ongoing on further capital strengthening measures at Air France-KLM Group level, adding that these measures could include instruments such as the issuance of equity or quasi-equity instruments, depending on market conditions.