Brazil’s Azul Considers Chapter 11 Amid Debt, Merger Talks

Azul Linhas Aéreas Brasileiras is reportedly weighing a potential Chapter 11 bankruptcy filing as part of broader efforts to address mounting debt of USD5.35 billion accrued since the COVID-19 pandemic. According to Bloomberg, options under review include Chapter 11, additional capital raising, or a possible merger with another carrier. No final decision has been made.
In a May 16, 2025 statement, Azul neither confirmed nor denied the report, saying it “constantly monitors alternatives that may contribute to strengthening its capital structure and preserving liquidity.” The airline pledged to keep shareholders informed of any material developments.
CEO John Rodgerson did not mention a possible Chapter 11 filing during the company’s May 14 earnings call. Instead, he emphasized Azul’s focus on operational efficiency and ongoing business improvements. “We are focused on turning Azul into a lean operating airline,” he said.
Azul recently restructured approximately USD1.6 billion in debt and raised USD525 million through agreements with bondholders, OEMs, and lessors. CFO Alexandre Malfitani noted that equity offers have been launched, including one to equitize debt and another supported by controlling shareholders. However, an April offering failed to attract new capital due to poor market timing.
Azul is also in ongoing merger discussions with Abra Group, the parent of GOL Linhas Aéreas, though GOL must first complete its own Chapter 11 process, expected by June.
In Q1 2025, Azul reported an adjusted net loss of BRL1.82 billion (USD321 million), citing higher costs and currency depreciation. Net debt stood at BRL31.35 billion (USD5.53 billion), down 50% from a year earlier.
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Sources: AirGuide Business airguide.info, bing.com, ch-aviation.com