Major creditors have given Brazilian flag carrier Varig a reprieve on $118 million in debts due by the year's end. Two local banks, Varig's fuel supplier, and lessor General Electric Capital Aviation Services (GECAS) agreed to pardon some debts, defer others, and waive interest in exchange for Varig's commitment to stay current on principal payments after the first of the year. They also agreed to capitalise up to a third of all amounts owed to them. This is part of a broader accord that includes overhaul and integration of management for Varig and regional subsidiaries, Nordeste and Rio-Sul. Varig's total debt burden remains near $900 million.

Source: Airline Business