Avianca Holdings has set a deadline for the exchange offer of its $550 million bonds due May 2020 has been further extended to October 24.
As of today, a total of 87.45% of bonds has been validly tendered.
Earlier this month, Avianca reached an agreement with United Airlines and Kingsland Holdings in regards to a $250 million financing loan.
United and Kingsland have agreed to provide Avianca a four-year loan at an interest rate of 3%; interest will be paid-in-kind until maturity, granting Avianca greater financial flexibility.
The loan will convert into shares at Avianca’s option – at an equivalent price per share of US$ 4.6217, representing a 35% premium over the 90-day weighted average price through October 3 – subject to certain conditions, including AVH’s share price consistently trading above seven dollars.
Avianca Holdings' chief financial officer, Adrian Neuhauser, commented: "We are finalising the steps necessary to close the transaction and expect that this will be final extension.
"The high level of participation that we have already achieved in the exchange offer, together with the announcement of our agreement with United Airlines and Kingsland Holdings regarding the conditions of the $250 million stakeholder loan, represent key milestones towards the successful completion of our debt reprofiling program, allowing us to move forward with the Avianca 2021 plan."
All tendering bondholders will receive secured notes as described in the exchange offer memorandum. Such notes will automatically exchange for new notes with a three-year extended maturity and a 9% coupon, upon completion of the $250 million financing led by United and Kingsland Holdings in Avianca.