Latam Airlines Group SA “flatly rejected” Azul SA’s offer to buy the bankrupt carrier even though the sale would be a better deal for creditors, Azul contends in new court filings, Bloomberg News reported. Azul for months has been expressing interest in a tie-up with Chile’s Latam, but the bankrupt airline has refused to seriously engage in talks, lawyers for Brazil-based Azul said in court papers. Azul said its deal outlined in a Nov. 11 term sheet values Latam at $13 billion and would provide more for creditors than Latam’s current proposal, which is on the verge of seeking court approval. Latam has said Azul’s offer lacked critical details — like how the deal would be executed, how long it would take and whether it could be approved by regulators — as well as the requisite support from creditors. Latam’s restructuring plan is backed by a key group of creditors — including SVPGlobal, Sculptor Capital Management and Sixth Street Partners — and its largest equity holders. Latam is approaching a critical juncture in its effort to exit the bankruptcy case, which began with a chapter 11 filing in May 2020 as COVID-19 lockdowns stymied international travel. On Thursday, the company will seek a bankruptcy judge’s permission to begin collecting creditor votes on its restructuring plan. Its official committee of unsecured creditors is opposing that step, alleging the plan violates U.S. bankruptcy law.
