Reuters
Published Jul 14, 2023 07:18
Updated Jul 14, 2023 07:36
(Reuters) -Air France-KLM said on Friday it had signed a definitive agreement with private equity firm Apollo Global Management for a 500 million euro ($561 million) capital injection for one of its engineering and maintenance units.
Sale and leaseback deals are common financing mechanisms in aviation. But a flood of investment from new sources of funding has increased competition for traditional leasing companies.
The financing from Apollo will be used for the French company's Engineering and Maintenance (MRO) components activity and it will not result in a change of ownership of the division nor will it have any impact on employees' contracts, the company said.
Apollo will subscribe to perpetual bonds bearing an interest rate of 6.9% for the first three years, after which gradual step ups and caps will be applied, the company said.
Air France will have the ability to redeem them at any time after three years.
Air France-KLM (LON:0LN7) and Apollo Global Management entered into a similar solution last year where the private equity firm invested 500 million euro in the company to help repay French state aid.
($1 = 0.8913 euros)
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.