Strategic Loan to Stabilize Gol Airlines Finances

Abra Group, the major shareholder of Brazilian airline Gol (GOLL4), is on the brink of finalizing a crucial $1.3 billion loan with investment firm Castlelake to stabilize Gol’s financial situation. The loan aims to address the challenges faced by Gol, especially after its Chapter 11 filing earlier this year.

Castlelake, a global alternative investment firm with $22 billion in assets under management, presented a refinancing proposal targeting bonds maturing in 2028 to Abra’s investors. The proposed new debt could have interest rates up to 16% or a combination of 8% PIK and 6% cash coupon. Convertible bondholders, crucial for the deal’s success, largely support the agreement.

Castlelake, known for its strong investment strategy in the aviation sector, plans to refinance the bonds at a premium with a five-year term. The firm’s expansion in the aviation industry, including co-ownership of SAS with Air France-KLM and loans to United Airlines, reinforces its credibility in the market.

Stay tuned for updates on this strategic loan that could potentially save Gol from financial distress and pave the way for its merger with Azul, under the supportive eye of the Brazilian government.