Volaris Successfully Completes $85 Million Notes Offering in Mexico

Mexican low-cost carrier Volaris has successfully concluded the issuance of 15 million asset-backed trust notes, raising MXN 1.5 billion pesos (USD 85 million). The Mexican National Banking and Securities Commission had granted the airline authorization to raise up to MXN 5 billion (USD 284 million), making this the third capital raise within that limit.

The notes, with a five-year maturity term, feature an interest rate linked to the 28-day interbank rate plus 215 basis points. The issuance is secured against future collection rights related to agreements with credit card processors for the sale of airline tickets and associated services.

Volaris, facing debt maturities of USD 50 million in 2023 and USD 190 million in 2024, utilized the funds for general corporate purposes. This successful note offering follows the airline’s 2021 issuance of MXN 1.5 billion (USD 74.5 million at the time) in five-year sustainability-linked bonds on the local market.

As a major player in the Mexican aviation market, Volaris serves 68 destinations across Mexico, Colombia, the United States, Guatemala, Peru, and Costa Rica. The airline, owned by Indigo Partners, operates a fleet of 116 aircraft, including various Airbus A319, A320, and A321 variants. In the 12 months leading up to July 31, 2023, Volaris transported over 33 million passengers.