Azul Sells Six Percent Equity Stake in TAP Air Portugal to Portuguese Government
Azul announced on Friday that they have sold their six percent equity stake in TAP Air Portugal, valued at R$65 million, to the Portuguese Government. Additionally, the carrier has withdrawn their conversion rights of its €90 million secured 2026 senior bond.
Azul S.A. (NYSE: AZUL) announced on Friday the sale of their six percent equity stake in TAP Air Portugal to the Portuguese Government, a stake valued at R$65 million. As part of the agreement, Azul has also withdrawn their conversion rights for €90 million in secured 2026 senior bonds they hold in the Portuguese national carrier. All other contractual relationships will remain intact including Azul’s status as a senior creditor, 7.5% annual interest and collateral including TAP’s loyalty program. The principal amount of the bond plus accrued interest is valued at around R$680 million and the transaction remains subject Azul’s corporate and shareholder approvals. In Friday’s announcement, Azul’s CEO, John Rodgerson said,
“As many other airlines worldwide, TAP has been severely impacted by the COVID-19 crisis. With the aid provided by the Portuguese Government we are able to ensure the continuation of TAP thereby guaranteeing the integrity of our bond.”
Azul is largest airline in Brazil, based on the number of departures and cities served. Prior to the global COVID-19 pandemic, the carrier offered 916 daily departures to 116 destinations and operated a fleet of 142 aircraft. The airline employs more than 12,000 and has a network of 249 nonstop routes (as of December 31, 2019).