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(Adds details, CFO interview)
By Gabriel Araujo
SAO PAULO, June 28 (Reuters) - Brazilian airline Azul said on Wednesday that a group accounting for roughly 86% of holders of bonds expiring in 2024 and 2026 have agreed with an exchange offer proposed by the company to delay their maturities to 2029 and 2030.
The offer had been
announced
by the company earlier this month as part of a broader restructuring plan that also included deals with aircraft
lessors
for lower payments, with initially 65.5% of the bondholders having agreed with it.
Now, with the early participation phase of the offer concluded, the carrier celebrated what it described as a high level of acceptance.
"It's a very positive figure," Azul Chief Financial Officer Alex Malfitani told Reuters in an interview. "That leaves us in a very solid financial position, with no more doubts on whether we would be able to roll over that debt."
Azul expects the exchange offer for bonds totaling $1 billion to remove an overhang on its stock as it deals with high short-term indebtedness, even though it had to increase interest paid on those notes against a backdrop of high borrowing costs.
"It's part of the game," Malfitani said, adding the coupon Azul managed to negotiate with creditors was "palatable and fitting well within our business model and cash flow."
The aggregate participation level in the exchange offer includes 72.8% of holders of bonds due on 2024, totaling $291.17 million, and 94.6% of holders of notes expiring in 2026, accounting for $567.6 million, Azul said.
Markets had welcomed the initial announcement, with shares of Azul up about 14% since June 13 on optimism the deal could strengthen its cash flow and invest in additional routes.
The airline is also gearing up to raise additional
capital
.
Still, ratings agency Fitch has downgraded Azul's issuer default rating to "C" from "CCC-", saying it viewed the move as distressed debt exchange as per its criteria.
That, however, didn't worry the carrier.
"I think that is temporary," Malfitani said, noting rating agencies had very strict parameters for exchange offers. "When our restructuring is complete, we'll be able to see the rating of Azul's new capital structure." (Reporting by Gabriel Araujo; Editing by Steven Grattan)