(Boursier.com) — Air France-KLM and Apollo Global Management announce the upward review and completion of quasi-equity financing of 1.5 billion euros.
Following the signing on October 26, 2023 of a definitive agreement between Air France-KLM and Apollo concerning the financing of a dedicated operational subsidiary of Air France-KLM, the companies finalized the transaction for a total amount revised upwards of 1.5 billion euros.
This financing by funds and entities managed by Apollo is intended for an operational subsidiary of Air France-KLM which holds the brand and most of the commercial partner contracts linked to the joint loyalty program of Air France and KLM (Flying Blue ), as well as the exclusive right to issue “Miles” for airlines and their partners. The financing is recognized as equity under IFRS. As announced by Air France-KLM during the 3rd quarter 2023 results, this transaction will allow the group to restore its equity according to IFRS standards to a positive level by the end of the year.
The upward revision of the transaction amount reflects the great confidence of investors in the quality of Air France-KLM’s mileage issuing activity (Flying Blue).
The conditions communicated on October 26 remain unchanged and relate to a fixed coupon of 6.4% per year for the first 4 years, with the possibility for Air France-KLM to repay with an overall financing cost of 6.75% until this first payment date. call.
The agreed structure will not result in any material changes to Flying Blue members. Air France-KLM will continue to manage and operate its Flying Blue loyalty program and the airlines Air France and KLM will retain full control of the Flying Blue customer database. The financing structure will not lead to any changes to social aspects, nor to the contracts of employees of Air France, KLM or Air France-KLM.
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