Brazilian carrier Gol plans to issue an at least $350 million senior unsecured bond to prepay debt and boost its cash balances.
The airline will use proceeds from the issue by its Gol Finance subsidiary to prepay roughly $200 million in debt, including the full amount outstanding under its 8.875% notes due in 2022, and increase cash by about $150 million, S&P Global says in a report. The rating agency rates the proposed bonds B-.
Bank of America Merrill Lynch, Credit Suisse and Morgan Stanley are global bookrunners, while BTG Pactual, Evercore ISI, Santander, BCP Securities and Safra are acting as joint bookrunners.
Gol launched a tender offer for the $277 million outstanding under the 2022 notes today, it says in a securities filing. It is offering $1,065 for every $1,000 in principal plus accrued interest to holders of the bonds.
The tender offer expires on 8 December pending the successful completion of the new unsecured bonds.
S&P says Gol's balance sheet stands to benefit from the reduced interest rate burden from the prepayment of the 2022 notes.
Gol last closed $300 million in unsecured debt in August 2015. The five-year loan carried a coupon of 6.5% and was guaranteed by Gol shareholder Delta Air Lines.