Brazilian airline Azul subsidiary Azul Secured Finance has launched an exchange offering for its existing senior notes, the company said on December 17, 2024.
The offer includes the exchange of any and all of the outstanding 11.500% senior secured second out notes due 2029, with an outstanding amount of $245.17 million, for new 2029 notes; and for any and all outstanding 10.875% senior secured second out notes due 2030, with an outstanding amount of $583.67 million, for new 2030 notes.
The exchange includes early participation premium, which expires on January 7, 2025. The offer includes a PIK interest cash payment for November 2024. For the 2029 notes, payment equals $28.75 per $1,000 and for the 2030 notes, payment is $27.19 for every $1,000.
The expiration deadline for the offer is expected to be January 22, 2025. The requires 95% of participation across both series and existing noteholders that do not participate will have “all of the restrictive covenants, events of default, and related provisions” of their securities eliminated, “meaning that any existing notes that remain outstanding after the consummation of the exchange offer will be unsecured obligations," the company explained.
The company said noteholders “in excess of 66.67%” have agreed to tender their existing notes in the exchange offer already.
The new notes will be guaranteed by Azul, Azul Linhas Aéreas Brasileiras, IntelAzul, ATS Viagens e Turismo, Azul IP Cayman Holdco, Azul IP Cayman, Azul Conecta, Azul Investments and Azul Secured Finance II.