Brazilian carrier Gol has secured exit financing from unnamed investors as it works to emerge for Chapter 11 restructuring as “a well-capitalised standalone company”.
Gol said in a 24 March letter to shareholders that it had secured $1.25 of $1.9 billion in debt instruments that will be issued as part of its restructuring plan from “certain investors”. It did not get more specific.
The company says it will use the equity to repay debt as party of Chapter 11 proceedings in US bankruptcy court.
Gol is exploring further transactions, including the “issuance or assumption of new debt” and potential equity investments, and is considering opportunities presented by “prospective financial investors”.
Under the plan, the company intends to deleverage its balance sheet by converting into equity or “otherwise extinguishing” up to $1.7 billion of funded debt and about $850 million of other obligations.
Upon execution, those transaction are expected to cause a “significant dilution” of Gol’s outstanding shares.
In November, Gol disclosed that it had entered a debt-for-equity deal with majority investor Abra Group. Terms include eliminating up to $2.55 billion in debt from the carrier’s books and Abra receiving around $950 million in new Gol equity.
Sao Paulo-based Gol entered the formal financial restructuring process in January 2024, citing a need to restructure debt and address lingering challenges from the Covid-19 pandemic.
Gol will report its most recent quarterly results on 28 March.
On a parallel track with Gol’s restructuring plan, Abra is exploring a possible combination of Gol and Azul in a deal that would create Brazil’s largest airline.
