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.