Legal Services
Whitecase
Full Credential Description
Global law firm White Case LLP advised Azul Airlines, a prominent Brazilian airline, on a comprehensive restructuring of its aircraft lease obligations and commitments to original equipment manufacturers and bondholders. This restructuring, finalized on September 29, 2023, was necessitated by the financial strain caused by the COVID-19 pandemic, which had led to deferred lease payments. The tailored solution provided by White Case included several key components: the permanent elimination of previously deferred lease payment obligations, a reduction in lease payments from original contractual rates to current market rates, and the deferral of certain payments to lessors and OEMs. Additionally, the restructuring involved improved end-of-lease compensation obligations, the elimination of future maintenance reserves payments, and the negotiated early termination of specific aircraft leases. As a result of this restructuring, Azul Airlines and its creditors agreed to exchange existing debts and future rent reductions for notes payable in 2030 and preferred equity in the airline. Specifically, 40% of the outstanding amounts or rent reductions were repaid through the issuance of these notes, while 60% were deemed repaid periodically via preferred equity issuance. The total value of the preferred shares was up to US$570 million, with shares valued at R$36.00 each. This strategic restructuring not only alleviated immediate financial pressures but also positioned Azul Airlines for future growth and stability in a challenging market.