Brazil airline Azul completes payment deal with lessors, OEMs

Brazilian airline Azul has completed restructuring obligations it had with most of its lessors and equipment manufacturers, part of a broader shake-up that also saw the carrier delay debt maturities and raise additional capital. The deals, Azul said in a securities filing late on Sunday, include the elimination of lease obligations previously deferred during the COVID-19 pandemic and a permanent reduction in lease payments from their original rates to current market rates. The arrangement had been initially announced in March, when the carrier said it had agreed to give lessors and original equipment manufacturers (OEMs) equity and tradable debt in exchange for lower payments. "Through these agreements, we have significantly improved our capital structure and cash flow by reducing our lease liabilities and payments, while honoring our commitment to fully compensate our partners," CFO Alex Malfitani said in the filing. The airline estimated the restructuring will reduce lease payments by more than 1b reais ($198.73m) per year going forward. As part of the deals, Azul said it has issued $370m of 7.5% unsecured notes due 2030, while also agreeing to give lessors and manufacturers up to $570m in preferred shares of the company valued at 36.00 reais each.<br/>