Contributor - South America

Richard Pedicini

No one bid for the loyalty program of Avianca Brasil during Wednesday’s auction for seven pieces of the bankrupt airline’s assets, and Latam and Gol made their bids—totaling $147.3 million for its routes—contingent on the inclusion of Avianca’s slots. As civil aviation agency ANAC has said previously, it will redistribute those slots in line with regulations, a position that so far has been backed by the courts.

 


Each airline bid $70 million for one block of slots, as promised in the bankruptcy reorganization plan, and TAM bought one block at the $10,000 minimum and Gol another. A fierce bid for one block of daily early-morning Congonhas slots left Gol the victor at $7.3 million, and one block went unsold, like the loyalty plan.

 


Both Latam and Gol announced they would use their priority credits in the bankrupcy as partial payment. Each had made a no-recourse advance payment of $35 million to Avianca's principal creditor, American investment group Elliot, as well as debtor-in-possession (DIP) loans of $13 million.

 


Brazil's third largest airline, Azul, saw its offers of $106 million and then $143 million for part of Avianca's operations spurned when Avianca’s right to the slots remained undisputed, and its partial survival seemed possible. Azul did not participate in the auction, saying in a note that it “did not believe in the legitimacy of the process.” Azul had also made a DIP loan of $13 million.

 


Discounting the credits from DIP loans and interest accumulated up to now and during the unpredictably prolonged legal wrangling over the slots, it remains unclear how much money the auction will finally yield to pay Avianca's creditors, employees, and ticket holders. Azul had asked a court that the $70 million its competitors paid to Elliot be held in escrow, but the judge rejected the petition.

News about commercial airlines, including regulations, aircraft orders, safety, acquisitions, and mergers.

Bids for Avianca Brasil Contingent on Slot Awards

Latam, Gol are paying $70 million each for the bulk of bankrupt airline Avianca Brasil's assets.    

2024 Corporate Aviation Leadership Summit

Charles Alcock

News and developments about airplanes, helicopters and unmanned air vehicles used in all varieties of operations, including airlines, military, business, commercial, general aviation and private.

News about environmental issues relating to aircraft operations, including noise issues, emissisions, and regulations. See Fuel for biofuel.

News and issues relating to international air transport and cargo carriers, national airlines and regional airlines, including aircraft, engines, personnel, acquisitions, accidents, safety, security and training.

Agreement between start-ups could lead to orders for up to 15 aircraft

Skyhop Plans Island Routes With Noemi's Electric Seaplane

Howard Hardee

Airline plans to gradually replace its Embraer E-Jet fleet

A220’s Performance Drives BermudAir’s Fleet Growth

Partners say eVTOLs could accelerate response times in crowded Indian cities

Air India Backs SkyDrive Emergency Medical eVTOL Plans

News and issues relating to the aerospace industry that are related to the science, engineering and business of flight in space involving civil, industrial and military applications, and similar topics related to flight in the atmosphere of the Earth that are not covered more directly by other AINonline subject channels. In other words, both astronautical and aeronautical subjects, except for those aeronautical topics that are specifically covered elsewhere on this website.

Rival Boeing arguably claimed bragging rights at the Farnborough International show

Airbus Balances Shareholder Returns and New Aircraft

New developments at airports including regulations and noise issues; legal disputes; openings, acquisitions and mergers.

Connections to London Heathrow and Manchester airports will start first

Virgin Firms Up eVTOL Air Taxi Alliance with Joby

News and developments about everything that goes into the cabin of an aircraft, from floor coverings to headliners, with a special emphasis on in-flight entertainment, communications and other electronics for passengers. If it is in the cabin of an aircraft, it’s covered here.

More In Airlines

Skyhop Plans Island Routes With Noemi's Electric Seaplane

Agreement between start-ups could lead to orders for up to 15 aircraft

A220’s Performance Drives BermudAir’s Fleet Growth

Airline plans to gradually replace its Embraer E-Jet fleet

Air India Backs SkyDrive Emergency Medical eVTOL Plans

Partners say eVTOLs could accelerate response times in crowded Indian cities

Airbus Balances Shareholder Returns and New Aircraft

Rival Boeing arguably claimed bragging rights at the Farnborough International show

Virgin Firms Up eVTOL Air Taxi Alliance with Joby

Connections to London Heathrow and Manchester airports will start first

ATR Chases New Regional Markets for Twin Turboprops

Iran war and wider geopolitical pressure stall buying decisions

Embraer Racks Up E-Jet Orders at Farnborough

30 firm orders led by Abra

Gulf Air May Buy JetZero’s Blended-wing-body Z4

Japan Airlines also expresses interest at Farnborough Airshow

AIN Products

SUBSCRIPTIONS

RESOURCES

ABOUT AIN