4-Apr-2019 8:52 AM

GOL Linhas Aéreas enters the negotiations for Avianca Brazil's judicial recovery

GOL Linhas Aéreas decided (03-Apr-2019) to engage in negotiations initiated by Manchester Securities Corp, Elliott Associates and Elliott International with the objective of developing an alternative proposal related to the competitive sale process of certain of the assets of Avianca Brazil, currently under judicial restructuring. Elliott is the main creditor in the restructuring. GOL and Elliott entered into a binding agreement that establishes the following:

  • Elliott will present a revised judicial restructuring plan for Avianca Brazil, which will be submitted for approval of Avianca Brazil's creditors in the judicial restructuring and will provide for, among others:
  • GOL will provide Avianca Brazil with short term post petition financings, of USD5 million and USD3 million in principal amounts to be provided on 09-Apr-2019 and 16-Apr-2019, respectively, subject to satisfactory conclusion of its due diligence process and acquire from Elliot up to USD5 million in short term post petition financings, to the extent those are provided by Elliot to Avianca Brazil between on 02-Apr-2019 and 05-Apr-2019 at par value;
  • GOL will make a minimum offer of USD70 million for one of Avianca Brazil's UPIs to be auctioned as part of the revised judicial restructuring plan, subject to certain conditions of the revised judicial restructuring plan;
  • GOL agreed to advance USD35 million to Elliott in four monthly instalments. In exchange for the payment of the advance and subject to certain conditions, Elliott will pay to GOL a portion of the amounts recovered by Elliott as part of the judicial restructuring.

In case GOL acquires any airline UPI, it will offer employment, pursuant to new employment agreements, to Oceanair's employees that participate in the activities of the acquired UPI. [more - original PR]

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