Avianca Holdings S.A. Issues Statement on
Debtor-in-Possession
Financing
and Government of Colombia Financing
Commitment
BOGOTA, Colombia, August 30, 2020 – Avianca
Holdings S.A. (OTCMKTS: AVHOQ, BVC: PFAVH) (the “Company” or
“Avianca”) today issued a statement regarding the Company’s
expected debtor-in-possession (“DIP”)
financing, following the announcement by the Republic of Colombia’s
Ministerio de Hacienda y Credito Público (the Finance Ministry)
that the management committee of the country’s Fondo de Mitigación
de Emergencias (“FOME”, the Emergency Mitigation Fund) had approved
the government’s participation in Avianca’s DIP financing, through
a commitment of up to US$ 370 million in the proposed loan
structure, side by side with private market investors. Avianca
commented as follows:
We are pleased that the Government of the Republic of Colombia will
participate in the Company’s DIP financing and express our
gratitude for the confidence and support this commitment
demonstrates.
As we previously disclosed on August 13, 2020, Avianca’s DIP
loan financing is expected to consist of two tranches that include
approximately US$ 1.2 billion of new funds as part of a US$
2.0 billion overall financing facility (including rollups of
existing debt and purchase consideration) which will allow the
Company to finance its operations during the pendency of its
Chapter 11 reorganization. In addition to the Colombian government
committing to participate in the DIP loan -by providing approximately 30% of the
new funds, or 20% of the total DIP financing- we are also very
pleased with the positive reception the DIP loan structure has
received from third-party institutional investors that, along with
existing lenders, are expected to provide a substantial majority of
the DIP loan financing.
Based upon the substantial indications of interest received to
date, we are confident in our ability to complete the syndication
process and finalize documentation within the next week. We
look forward to filing shortly thereafter a motion to approve the
financing with the U.S. Bankruptcy Court, which motion will set
forth our full DIP financing package, with approval expected during
the month of September. The DIP loan, which will be secured by
Avianca’s key assets (including the Company’s ownership stakes in
its LifeMiles and cargo subsidiaries, as well as by its key brands
and cash accounts) will contain certain conditions precedent to be
satisfied prior to drawing those funds.
Additional information about the DIP financing is available on
Avianca’s website (www.aviancaholdings.com).
About Avianca Holdings S.A. (OTCMKTS: AVHOQ) (BVC:
PFAVH)
Avianca is the trademark for the group of passenger airlines and
cargo airlines under the holding company Avianca Holdings S.A.
Avianca has been flying continuously for 100 years. As of December
2019, the Company operated a fleet of 158 aircraft and served 76
destinations in 27 countries within the Americas and Europe. With
more than 21,000 employees, the Company earned US$ 4.6 billion
in 2019 and carried 30.5 million passengers.
Forward-Looking Statements
Avianca has included statements in this press release that
constitute “forward-looking statements”. As a general matter,
forward-looking statements are those focused on future or
anticipated events or trends, expectations, and beliefs including,
among other things, the Company’s expectations with respect to its
Chapter 11 proceedings, the airline industry and the impacts of
COVID-19. Such statements
are intended to be identified by words such as “believe,” “expect,”
“intend,” “estimate,” “anticipate,” “will,” “project,” “plan” and
similar expressions in connection with any discussion of future
operating or financial performance. Any forward-looking statements
are and will be based upon the Company’s then-current expectations,
estimates and assumptions regarding future events and are
applicable only as of the dates of such statements. Readers are
cautioned not to put undue reliance on such forward-looking
statements.
