BOGOTÁ, Colombia, July 22, 2019 /PRNewswire/ -- Avianca
Holdings S.A. (NYSE: AVH, BVC: PFAVH) today announced that, in
connection with its previously announced re-profiling plan for its
capital structure, the company has temporarily deferred payments on
certain long-term leases and on payment of principal on certain
loan obligations. Avianca Holdings has engaged in discussions
with its main strategic lenders and other creditors to establish
terms that will preserve current liquidity levels and enable
Avianca Holdings to advance its re-profiling plan, which is aimed
at strengthening the company's financial position. Over the last
two weeks, members of Avianca Holdings' senior management team have
met with more than 50 of Avianca Holdings' strategic lenders and
other creditors with the objective of reaching an agreement on the
terms and conditions of the proposed deferrals. Importantly,
obligations related to Avianca Holdings' day-to-day operations
remain current, and such operations, including flight schedules and
other ordinary course operations, will remain unaffected.
Avianca Holdings affirms that it is current on all existing
interest obligations and that Avianca Holdings actively seeks to
arrive at a mutually satisfactory agreement with its strategic
lenders and other creditors for a short-term deferral of principal
amortization payments, as well as extensions of its credit
facilities. Avianca Holdings intends to resume scheduled principal
payments once these agreements have been successfully reached, as
Avianca Holdings' proposal is for all creditors to be paid in full,
including principal and interest.
In connection with its re-profiling program, Avianca Holdings
today made a separate announcement regarding an exchange offer for
its outstanding 8.375% Senior Notes due 2020. Avianca Holdings is
current on its interest obligations with respect to its outstanding
senior notes and is not otherwise in default on its outstanding
2020 Senior Notes.
Avianca Holdings has the full support in this decision of its
Board of Directors. Since May 24,
2019, Kingsland Holdings, through its ownership of ordinary
shares of Avianca Holdings and authority to vote the ordinary
shares of Avianca Holdings owned by BRW Aviation LLC, has effective
control of Avianca Holdings. As previously announced, United
Airlines and Kingsland Holdings have indicated that they would be
willing to offer new financing to Avianca, if required and
requested, of up to $250 million,
provided that certain commitments are assumed by other interested
parties.
With the announced temporary suspension of principal payments,
as well as the previously announced proposed financing by United
Airlines and Kingsland Holdings, and the continued implementation
of Avianca Holdings' 2021 transformation plan, Avianca Holdings
expects to strengthen its cash balances in the near future, at
which time, Avianca Holdings will resume normal payment of its
obligations. Furthermore, Avianca Holdings has stated that
the outstanding 2019 Colombian Peso-denominated corporate bond
issued by Aerovías del Continente Americano – Avianca S.A. is not
part of the deferral program and that such bond will be paid in
accordance with its terms.
About Avianca Holdings
Avianca is the commercial brand
that identifies the passenger, cargo transportation airlines and on
ground services integrated in the Company with a team of more than
21,000 employees. The terms "Avianca Holdings" or "the Company"
refer to the consolidated entity. The original source-language text
of this announcement is the official, authoritative version,
Translations are provided as an accommodation only, and should be
cross-referenced with the source-language text, which is the only
version of the text intended to have legal effect.
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SOURCE Avianca Holdings S.A.