Abra Group closes $1.4bn investment in Brazil's GOL

GOL Linhas Aéreas Inteligentes has gained access to US$451m of cash after the Brazilian airline closed a USD1.4 billion private placement with its controlling shareholder, Abra Group, of its senior secured notes due in 2028. The transaction represents one of the largest completed liability management and comprehensive refinancing transactions in the airline industry and emerging markets, the airline said in a stock market filing. It also represents the tenth liability management or capital raising that GOL has completed since the onset of Covid-19. The airline reported significant improvements in its capital structure and its credit profile due to the access to cash and a reduction in annual interest payments. The issuance on March 3, 2023, included US$451m in cash for specific uses subject to certain conditions and approvals, and the contribution and retirement of US$1.077m in face value of GOL's outstanding bonds. This represents 83% of the bonds maturing in 2024, 47% of the bonds maturing in 2025, 61% of the bonds maturing in 2026, and 10% of the perpetuals. These bonds have been cancelled, representing a discount to par of US$312.6m. Pro forma for the transaction, the net debt of GOL will be reduced by over US$100m, resulting in more than US$30m in annual interest expense savings.<br/>