NEW YORK/SAO PAULO, Dec 12 (Reuters) – A U.S. bankruptcy judge on Friday approved Azul’s debt restructuring, allowing the Brazilian airline to cut more than $2 billion in debt and raise capital through a new equity rights offering and investment from American Airlines and United Airlines.
U.S. Bankruptcy Judge Sean Lane approved Azul’s bankruptcy plan at a court hearing in White Plains, New York.
Azul filed for Chapter 11 bankruptcy in New York in May, aiming to cut its debt and make its business more resilient to market challenges like fluctuations in fuel prices and currency exchange rates.
The company’s bankruptcy plan converts much of its pre-existing debt into equity and allows it to raise cash by selling new equity shares.
As part of the bankruptcy, United and American agreed to invest up to $300 million in Azul’s equity.
(Reporting by Dietrich Knauth in New York and Gabriel Araujo in Sao Paulo; Editing by Chris Reese)
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