GOL Airlines Secures $1.25 Billion in Chapter 11 Funding
Brazil’s GOL Linhas Aéreas Inteligentes has secured a commitment of up to USD 1.25 billion in new financing as part of a broader USD 1.9 billion exit package to support its emergence from Chapter 11 bankruptcy proceedings. The announcement was made on March 24, with GOL stating that the funds will be used to repay existing obligations, cover transaction-related costs, and ensure sufficient working capital post-bankruptcy.
The financing is being led by investment firms Castlelake and Elliott Investment Management, which are committing the capital on behalf of their clients. According to Reuters, the minimum contribution from the two firms will be USD 750 million.
As part of its restructuring strategy, GOL is also exploring alternative financial transactions, including new debt issuance and equity investments. The airline is engaging with potential investors, including private equity firms, credit funds, and other strategic partners, with the aim of emerging as a financially stable and independent company.
In a further step to strengthen its balance sheet, GOL plans to convert up to USD 1.7 billion of its pre-petition funded debt, along with up to USD 850 million in other liabilities, into equity. This move is expected to significantly reduce the company’s debt burden but will result in major dilution of existing shareholder equity.
GOL expects to complete its restructuring and emerge from bankruptcy later this year, positioning itself for long-term sustainability in Brazil’s competitive aviation market.
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Sources: AirGuide Business airguide.info, bing.com, ch-aviation.com