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Cole files for judicial recovery in the USA

Cole files for judicial recovery in the USA

Judicial recovery is the goal
A plane takes off at Congonhas Airport in Sao Paulo / Credit: Rowena Rosa/Agencia Brazil

Gol Linhas Aéreas announced this Thursday (25/1) that the company and its subsidiaries have voluntarily filed for judicial recovery in the United States Bankruptcy Court for the Southern District of New York. A “Chapter 11” filing, as the company explains in a statement, deals with protection against creditors with the aim of “raising capital, restructuring finances and strengthening business operations and operating normally over the long term.” By 2023, the company acknowledged having R$20 billion in debt.

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And according to the report, the legal process begins with a US$950 million financing from a group of creditors of Cole and Avianca's controller, Abra. The financing, the company continues, “subject to court approval, together with cash generated by ongoing operations, will provide substantial liquidity for ongoing support activities during the financial restructuring process”.

The company guarantees that passenger flights, GOLLOG cargo flights, Smiles loyalty program and other operations will continue as normal.

According to the company, the objective is to use the judicial recovery process “to restructure its short-term financial obligations and strengthen its capital structure for long-term sustainability”. The company expects to “emerge from this process with significant capital investment, including new US$950 million DIP financing, to expand its position as a leading airline in Latin America.”

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“It will honor obligations to business partners and suppliers for goods and services provided on or after the date of the Chapter 11 filing,” the company says.

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It also said it “plans to honor all obligations to customers, including ticket refunds, travel coupons, and refunds or credits associated with package or service requests, in accordance with current company policies.”