By Brazil Stock Guide – Azul SA (AZUL3) told Brazil’s antitrust regulator Cade that delays in approving a planned investment by United Airlines Holdings Inc. (UAL) could pose “serious risks” to the airline’s financial health and even its operational continuity, as the carrier seeks to exit Chapter 11 restructuring proceedings in the US.
The warning comes ahead of a Cade tribunal session scheduled for Wednesday (11), when commissioners are set to review an appeal filed by consumer advocacy group IPSConsumo against the transaction. Azul shares closed down 38.68% at 4.55 reais, marking one of the steepest single-day drops in the stock’s recent history.
The deal, part of Azul’s restructuring plan launched in May 2025, would increase United’s minority stake in the Brazilian airline to about 8% from 2.02%, according to filings. Azul and United have argued that the transaction does not alter United’s rights over the carrier nor change the terms of their commercial partnership, and that it would not generate overlapping direct flight routes between Brazil and the US.
Cade’s Superintendence-General approved the transaction without restrictions on Dec. 30, concluding that the deal posed no competition risks. IPSConsumo appealed the decision, arguing that the antitrust review should also have incorporated Azul’s relationship with American Airlines Group Inc. (AAL), citing what it described as strategic interconnections involving both US carriers in Latin American aviation.
The institute also criticized what it called the excessive use of confidentiality protections and alleged that key information had been withheld from public scrutiny. It further pointed to cross-shareholding links involving United, American and the Abra Group, which is connected to Gol Linhas Aéreas Inteligentes SA (GOLL4).
Cade reporting commissioner Diogo Thomson granted IPSConsumo status as an interested third party, citing the case’s complexity and the existence of “structural issues still open, especially related to governance and competitive incentives resulting from the transaction.” Thomson said the appeal contained evidence that warranted further review.
In a petition filed Monday (9), Azul accused IPSConsumo of creating artificial obstacles that could delay the deal and harm consumers rather than protect them. The airline said the transaction is “extremely relevant” for maintaining Azul as an aggressive competitor in the market.
“The transaction is extremely relevant for Azul to remain an aggressive and effective competitor, and is therefore clearly pro-competitive compared to its counterfactual scenario,” the airline said.
Azul warned that prolonging Cade’s review could increase monthly costs tied to the restructuring process and create legal uncertainty with creditors.
“In addition to legal risks associated with possible challenges to the Chapter 11 plan by creditors, Azul has been incurring high monthly costs to conclude its restructuring process. These costs may increase if there is any delay beyond February 2026,” the company said.
Under Azul’s Chapter 11 plan, exiting the process requires raising at least $850 million through an equity offering. The plan foresees $750 million to be provided by a group of creditors and $100 million to be invested by United.
IPSConsumo argued in its filing that a deeper antitrust review would not necessarily prevent United’s capital injection into Azul. Azul, in turn, said any potential investment by American would be separate and still under negotiation, stressing that United is not involved.
“It is an initiative still subject to negotiations between the parties and, once formalized, it will be submitted to Cade for review in due course,” Azul said.
On Wednesday (11), Cade’s tribunal will decide whether to admit IPSConsumo’s appeal. If accepted, the case could move into a more detailed review phase, delaying a final decision and potentially extending the timeline of Azul’s restructuring roadmap.
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