By Brazil Stock Guide – Azul SA (AZUL4 BZ) said Wednesday (18) it has signed investment agreements with United Airlines Holdings Inc. (UAL) and American Airlines Group Inc. (AAL), securing a combined $200 million to support its capital structure as it prepares to emerge from Chapter 11 proceedings in the United States.
In a filing with Brazil’s securities regulator, the airline said each U.S. carrier committed separately to invest $100 million under amended equity investment agreements, subject to certain conditions precedent tied to Azul’s reorganization plan.
“Under the applicable EIAs and the conditions precedent set forth therein, each investor has committed, separately, to contribute $100 million, totaling $200 million in new funds, strengthening Azul’s capital structure and supporting the execution of the plan and the company’s operations following its exit from the Chapter 11 process,” the company said.
United’s investment will be carried out as part of the public share offering announced on February 3, 2026, with settlement scheduled for Thursday (20), under the transaction referred to as the ERO.
American’s investment is expected to occur through the issuance of warrants, in accordance with a warrant subscription agreement. Azul noted that “the effective full exercise of the warrants by American, under the terms of the Warrant Subscription Agreement, including the receipt of all underlying shares and any economic or political rights attached thereto, is subject to the fulfillment of certain conditions precedent set forth therein, including prior approval by Brazilian antitrust authorities (Conselho Administrativo de Defesa Econômica – Cade).”
The carrier also said it entered into an additional investment agreement with certain existing creditors, providing for a further $100 million capital injection in connection with the ERO.
“As part of the preparation for its exit from the Chapter 11 process, the company also entered into standalone warrant subscription agreements with United and with the Additional Investment Parties, jointly providing for the issuance of additional warrants which, if exercised, may increase the investments by United and the Additional Investment Parties by up to approximately $15 million for United and $10 million for the Additional Investment Parties, on an aggregate basis,” Azul said.
Completion of the investments remains subject to customary conditions, including the opening and closing of the preemptive rights period for existing shareholders in connection with the warrant issuance, effectiveness of the reorganization plan, completion of the ERO and receipt of any required regulatory approvals.
Leave a Reply