GOL Linhas’ DIP financing draws objection from noteholder group

By Sarah Lizee

Olympia, Wash., Feb. 14 – Brazil’s GOL Linhas Aereas Inteligentes SA’s $950 million debtor-in-possession facility from members of an informal group of Abra bondholders drew an objection from a group of holders of the company’s notes due 2026, according to documents filed Tuesday with the U.S. Bankruptcy Court for the Southern District of New York.

The group said the proposed DIP financing should be denied to the extent it primes or grants pari passu liens on the 2026 notes collateral, or alternatively, it should be modified to provide the noteholders adequate protection.

“The debtors are seeking to prime the holders of the GOL 2026 notes without providing adequate protection against diminution in value of the liens securing their claims,” the group said in the objection.

“Instead, the debtors appear to rely almost entirely on an expansive and incorrect interpretation of the intercreditor agreement that they assert provides an insider of the debtors – their parent company, Abra – with the ability to unilaterally waive the GOL 2026 holders’ fundamental right to adequate protection while at the same time providing itself with a generous and expansive adequate protection package.”

The group said the DIP motion should also be denied to the extent it provides for a waiver of marshaling of the DIP collateral.

GOL Linhas is a Sao Paulo-based provider of airline services. The company filed bankruptcy on Jan. 25 under Chapter 11 case number 24-10118.

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