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Azul concludes negotiations worth over US$ 2.4 billion with its bondholders, lessors and OEMs

1. Azul finalized its restructuring, reducing $2.1 billion in debt significantly. 2. The company secured $525 million in new capital to enhance liquidity. 3. Negotiations improved cash flow by over $300 million through 2027. 4. Azul plans to add 15 new Embraer E2 aircraft to its fleet this year. 5. The airline remains resilient despite challenges in fuel prices and currency devaluation.

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FAQ

Why Very Bullish?

The successful restructuring and capital influx significantly strengthen Azul's financial position, similar to past recoveries seen in airlines post-debt resolution.

How important is it?

The restructuring directly impacts AZUL's financial health and future prospects, indicating strong investor confidence.

Why Long Term?

Enhanced cash flow and fleet expansion signal sustainable growth, likely benefiting AZUL's long-term performance.

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The Company concluded its restructuring process initiated in 2024 to solidify its financial position, eliminating US$ 2.1 billion in debt and financial obligations and receiving US$ 525 million in new capital. Faced with a challenging scenario, the company opted for a commercial negotiation with its partners, enabled by its reputation and solid business model. , /PRNewswire/ -- Azul, the largest airline in Brazil in terms of destinations served and daily flights, announced this Tuesday the conclusion of the negotiation process with its bondholders, lessors and aircraft manufacturers, resulting in the elimination of over US$ 2.1 billion in debt and financial obligations from the company's balance sheet. This is the result of the exchange of instruments convertible into company stock worth US$ 557 million held by lessors and OEMs for 94 million preferred AZUL4 shares, as well as converting more than US$ 785 million of financial debt maturing in 2029 and 2030, along with other improvements to the company's cash generation. With over 16 years of operation in Brazil, the company faced last year a challenging external scenario, with the devaluation of the real against the dollar; operational costs highly impacted by the price of aviation fuel, which is one of the most expensive in the world; the high rate of litigation in the sector; the global supply chain crisis; and the floods in the south of Brazil. Even with this scenario, Azul was able to reach amicable agreements with all its investors and commercial and financial partners, enabled by the trust of the overall market. "This is another very important moment in Azul's history, as we conclude a negotiation process that will solidify our company even further. In addition to the extinction of US$ 2.1 billion in financial obligations, we received today a new capital injection of more than US$ 525 million, which will increase our liquidity and ensure we are stronger than ever," highlights John Rodgerson, CEO of Azul. The extinction of obligations includes strategic commercial agreements with lessors, manufacturers, and other suppliers, also ensuring a strengthening of the cash flow by more than US$ 300 million until the end of 2027. In addition to providing an improvement in cash flow over the next three years, the conclusion of the agreements will deleverage Azul by approximately 1.4x on a pro-forma basis using 3Q 2024 figures.  "We are very optimistic about Azul's future. We will add 15 new Embraer E2s to our fleet throughout this year, which will be extremely valuable to solidify our plan and expand access to air travel across the country. We thank our partners and investors for their trust, which allowed us to successfully conclude this negotiation and who will continue to support us in the constant strengthening of Azul," concludes the executive. About Azul  Azul S.A. (B3: AZUL4, NYSE: AZUL) is Brazil's largest airline in number of flights and destinations served, with over 1000 flights per day to more than 160 cities. With an operational fleet of more than 160 aircraft and more than 14,000 crew members, Azul flies more than 300 direct regional, domestic and international routes. In 2022, Azul was named the most on-time airline in the world, according to the OnTime Performance-OTP Review report by Cirium - the world's leading reference for operational data in the aviation industry. In addition, in 2020, Azul was elected the best airline in the world by TripAdvisor Travelers' Choice, being the only Brazilian carrier to be awarded with both prestigious industry recognitions. For more information, visit www.voeazul.com.br/imprensa. SOURCE Azul WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM? 440k+ Newsrooms & Influencers 9k+ Digital Media Outlets 270k+ Journalists Opted In

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