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Grupo Aeromexico draws final disbursement from DIP facility
By Sarah Lizee
Olympia, Wash., Feb. 19 – Grupo Aeromexico, SAB de CV has met the milestones necessary to receive the third and final disbursement of $675 million from its $1 billion senior secured superpriority multi-tranche debtor-in-possession facility, according to a press release on Friday.
The company had previously drawn down $100 million in a first tranche and $175 million in a second tranche under the facility.
Approval of the facility was made final by judge Shelley C. Chapman of the U.S. Bankruptcy Court for the Southern District of New York.
Of the facility’s amount, $850 million may be converted at the lenders' option into shares of reorganized Aeromexico, subject to some conditions and the applicable corporate and regulatory approvals for the issuance of the corresponding shares.
In order to complete the debt-into-equity conversion of the allowed unsecured claims in the company’s Chapter 11 process at a to-be-determined ratio, and the conversion of $850 million of the DIP facility, the shareholders meeting of the company would need to approve a capital increase.
If the lenders exercise the option to convert $850 million of the facility, following the corresponding capital increase, the shareholders will be almost fully diluted so that their remaining equity stake will likely be minimal, if any, provided that shareholders will be allowed to exercise their preemptive rights subject to several conditions that are yet to be determined.
Grupo Aeromexico, a holding company for commercial aviation, is based in Mexico City. The company filed Chapter 11 on June 30, 2020 under case number 20-11563.
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