Air France-KLM and Apollo sign a definitive agreement for a EUR 500 million investment into an ad hoc operating affiliate of Air France owning spare engines
13 Julho 2022 - 04:06PM
Air France-KLM and Apollo sign a definitive agreement for a EUR 500
million investment into an ad hoc operating affiliate of Air France
owning spare engines
Paris, July 13th 2022
Air France-KLM and Apollo sign
a definitive agreement for a EUR 500
million investment into an ad hoc
operating affiliate
of Air France owning
spare engines
Air France-KLM and Apollo Global Management
(NYSE: APO) today announced the signing of a definitive agreement
for Apollo-managed funds and entities to make a EUR 500 million
investment into an ad hoc operating affiliate of Air France that
will own a pool of spare engines dedicated to the airline’s
Engineering and Maintenance activities.
Under this agreement, Apollo affiliated entities
will subscribe to perpetual bonds issued by the ad hoc operating
affiliate, which will be accounted as equity under IFRS. The
proceeds of the transaction will enable Air France-KLM and Air
France to further redeem the French State perpetual bonds, in
accordance with the article 77 bis of the European Commission’s
“Temporary Framework for State aid measures to support the economy
in the current Covid-19 outbreak”, hence pursuing the redemption of
the French State aid.
As a result of the transaction, Air France-KLM
will benefit from lower financing costs. The perpetual bonds will
bear an interest rate of 6% for the first 3 years, and gradual step
ups and caps will be applied thereafter. Air France will have the
ability to redeem the bonds at any time after year 3.
This structure will incur no change of
ownership, operational and social aspects of Air France Engineering
and Maintenance activity. In the future, it could also help finance
the acquisition of additional spare engines to support Air France’s
fleet renewal program. There will be no change in the way Air
France uses the spare engines, and no impact on Air France or Air
France-KLM employees’ contracts.
The transaction, expected to close later in
July, is a part of the recapitalization measures announced on
February 17th, 2022.
Deutsche Bank AG and Skadden, Arps, Slate,
Meagher & Flom LLP are acting as exclusive financial and legal
advisors to Air France-KLM. Apollo Global Management was advised by
Milbank LLP and Jeantet as legal advisors.
Investor
Relations
Frédéric Kahane
Michiel
Klinkers
33 1 49 89 52 59
+33
1 49 89 52 60
frkahane@airfranceklm.com
michiel.klinkers@airfranceklm.com
Website: www.airfranceklm.com
- 20220713 - AFKLM_Maia_Press Release_final Eng version
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