04 November 2020

Carey Olsen acts on complex multi-jurisdictional US$2 billion DIP financing for Avianca Holdings S.A.

Carey Olsen has worked alongside a multi-disciplinary team from Milbank LLP on a complex debtor-in-possession (DIP) financing for Avianca Holdings S.A. (Avianca) following its successful application for Chapter 11 relief earlier this year.

Avianca is the second largest airline holding in Latin America by revenue and fleet size, and has been flying continuously for 100 years.

Avianca received approval from the US Bankruptcy Court for the Southern District of New York on October 5, 2020 to access its DIP financing totalling just over US$2.0 billion to support its go-forward operating plan in order to emerge from Chapter 11 protection.

The Carey Olsen team comprised corporate partner Mary Ward and counsel Sheba Raza who advised Avianca on key Bermuda aspects of the cross-border deal. The transaction included a Tranche A senior secured financing, a Tranche B secured subordinated loan and a repurchase from Advent International of a 30% interest in Avianca's Bermuda subsidiary LifeMiles Ltd, which operates one of the largest loyalty programs in Latin America.

Mary said: "We are thrilled to have been able to work so effectively with Milbank to assist Avianca in achieving this important step in its restructuring efforts as Avianca looks to emerge from the Chapter 11 process as a stronger business in these difficult times for the aviation industry."

Carey Olsen Bermuda Limited is a limited liability company incorporated in Bermuda and approved and recognised under the Bermuda Bar (Professional Companies) Rules 2009. The use of the title "Partner" is merely to denote seniority. Services are provided on the basis of our current terms of business.