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Aeromexico Shares Rise More Than 22% After Restructuring Deals

Published on Feb 3 2021 12:40 PM in General Industry tagged: Aeromexico

Aeromexico Shares Rise More Than 22% After Restructuring Deals

Shares of Aeromexico rose more than 22% after the Mexican airline negotiated new contracts with two labour unions, bringing it closer to accessing a second tranche of bankruptcy financing.

As part of the deal with the pilots' association (ASPA), Aeromexico and the union agreed to pay cuts amounting to $350 million.

Aeromexico said that it has also reached a deal with the flight attendants' union (ASSA). It had negotiated agreements with its two other unions in December, part of a requirement for the next disbursement of funding.

The airline was approved for up to $1 billion in debtor-in-possession (DIP) financing, and received an initial $100 million payment in September.

"The objectives reached during the negotiations were necessary for the company to meet certain commitments and objectives required by the funders," Aeromexico said in a filing with the Mexican stock exchange.

It did not disclose the terms of the agreements.

Chapter 11 Bankruptcy Protections

Aeromexico filed for Chapter 11 bankruptcy protection in a US court in June, after the coronavirus pandemic slammed the global travel industry.

News by Reuters, edited by Hospitality Ireland. Click subscribe to sign up for the Hospitality Ireland print edition.

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