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Bankrupt Brazilian airline Gol received U.S. court approval on Wednesday for a $1 billion loan, after resolving the concerns of a group of lenders that feared they would be sidelined by the new loan, Reuters reported. Gol had previously proposed borrowing $950 million in bankruptcy, but it allowed the objecting lenders to kick in an additional $50 million on the new loan and receive interest on that new debt, Gol's attorney Justin Cunningham said at a hearing in Manhattan. Bankruptcy Judge Martin Glenn approved the loan at the hearing in Manhattan, saying he was pleased to see a compromise. "It's nice when more people want to put money in," Judge Glenn said. The previously objecting lenders, a group of investment funds that had loaned money to Gol in 2020, will not receive the same level of fees as the original group of lenders, who could receive up to $47.5 million in additional commitment fees and backstop fees under the loan agreement, according to court documents. Gol instead agreed to pay them $800,000 for attorneys' fees and costs related to the renegotiation of the loan. Gol filed for chapter 11 bankruptcy protection in the United States on Jan. 25. The airline had been suffering from long-term impacts of the COVID-19 pandemic on travel and has had difficulty sourcing sufficient Boeing 737 Max aircraft to meet a surge in post-pandemic demand for air travel, according to court documents. Judge Glenn previously approved a portion of the loan, allowing Gol to borrow up to $350 million at a court hearing in January.

Disgraced cryptocurrency entrepreneur Do Kwon should be extradited to the U.S. to face trial on fraud charges, rather than to his native South Korea, a court in the tiny Balkan country of Montenegro has ruled, the Wall Street Journal reported. Kwon’s lawyers have three days to appeal the ruling by the High Court in the Montenegrin capital of Podgorica, a spokeswoman for the court said Wednesday. The appeals court will have the final word in the case, she added. A local lawyer for Kwon, Goran Rodić, called the ruling illegal and pledged to appeal. Kwon, the creator of the failed TerraUSD and Luna cryptocurrencies, has previously denied committing fraud. Kwon has been at the center of a tug of war between the U.S. and South Korea ever since he was arrested in March 2023 at the Podgorica airport while attempting to board a private jet to Dubai with a fake Costa Rican passport. Both the U.S. and South Korea have sought to prosecute him on charges stemming from the May 2022 collapse of TerraUSD and Luna. The crash erased some $40 billion in value from the crypto markets, hurt thousands of investors worldwide and triggered a chain reaction that caused other digital-currency firms to topple into bankruptcy. Last year, federal prosecutors in New York charged Kwon with eight criminal counts of fraud. The Justice Department alleged that Kwon misled investors about the stability of TerraUSD, an algorithmic stablecoin that used financial engineering to maintain a value of $1 a coin. A Stanford University-educated entrepreneur, Kwon had hyped TerraUSD as the future of money and derided critics who called it potentially unstable. The Securities and Exchange Commission has also sued Kwon and his company, Terraform Labs, over securities fraud in a civil case stemming from the TerraUSD and Luna collapse. Lawyers for Terraform Labs have denied the SEC’s allegations. Read more. (Subscription required.)

Liquidators of companies linked to the 1Malaysia Development Bhd scandal have filed for chapter 15 under the U.S. Bankruptcy Code, as they look to recover assets, Bloomberg News reported. A petition listing 1MDB Energy Holdings Ltd, Platinum Global Luxury Services Ltd, Aabar International Investments PJS Ltd, Blackrock Commodities (Global) Ltd, and Alsen Chance Holdings Ltd — all registered in the British Virgin Islands — was submitted in the Southern District of Florida court, dated Feb. 15. Liquidators said that the companies were subject to proceedings in the British Virgin Islands and made the U.S. petition because they hope to obtain information on the misappropriation of funds, according to the documents. Malaysia’s 1MDB investment fund became the center of a multibillion-dollar scandal that has spawned investigations around the world into deal-making, election spending and political patronage under former Prime Minister Najib Razak. The filing said that all five firms in question “acted as conduit for funds” from 1MDB to other entities and individuals.

Bankrupt Brazilian airline Gol Linhas Aereas Inteligentes SA won court permission to investigate whether its rival Latam Airlines Group SA sought to take unfair advantage of its recent chapter 11 filing by improperly soliciting major Boeing Co. aircraft suppliers, Bloomberg News reported. Judge Martin Glenn said Monday there is merit in investigating allegations Latam tried to either poach or interfere with Boeing 737 aircraft lessors doing business with Gol after the Brazilian budget airline filed bankruptcy last month. Judge Glenn cited a letter Latam sent to aircraft lessors the day after Gol filed bankruptcy. A Latam lawyer said the Jan. 26 letter was the fist time in recent years the company had inquired about a type of narrowbody Boeing 737 aircraft flown by Gol. Latam has historically flown a fleet of Airbus aircraft, according to court documents. It would be “preposterous” to assume it was merely a coincidence Latam sent the letter immediately after Gol filed Chapter 11, Glenn said. In the letter, Latam said it was seeking more aircraft, which the airline said might be of interest to lessors “given the recent events in the industry.” Judge Glenn granted the Sao Paulo-based airline’s request to get documents and conduct depositions of Latam officials in order to gather evidence, should any exist, substantiating claims that Latam sought to interfere with Gol’s business or violate its chapter 11 stay, which protects companies in bankruptcy. Latam has denied the allegations and argued Gol is seeking such information to gain an unfair edge on its rival.

Scandinavian airline SAS said it would file a second amended chapter 11 plan of reorganization with the U.S. Bankruptcy Court for the Southern District of New York on Monday and said it had obtained the support of the unsecured creditors' committee, Reuters reported. The company said it expected about $325 million to be allocated to general unsecured creditors as part of the amended plan, consisting of up to $250 million in cash and $75 million in new equity. The $75 million in new equity to be allocated to creditors would be distributed to general unsecured creditors like the Danish, Norwegian, and Swedish states, aircraft lessors, pilot unions, and key suppliers, the company said. Other creditor classes, including holders of the listed commercial hybrid bonds, are expected to receive a cash-only recovery. The airline said that holders of the company's listed commercial hybrid bonds would receive an initial cash recovery of 6.9%–9.4% of the nominal value of claims after emerging from the chapter 11 process. SAS, Scandinavia's biggest carrier, reiterated that there would be no value for its existing shareholders and all of its common shares and listed commercial hybrid bonds will be cancelled, redeemed and delisted.

A unit of Byju’s, once one of India’s hottest tech startups, filed for chapter 11 protection in Delaware, Bloomberg News reported. Byju’s Alpha, a special-purpose company formed for financing, listed assets of at least $500 million and liabilities of at least $1 billion in its bankruptcy petition. Lenders to Byju’s won a court fight in Delaware late last year that allowed them to appoint a new director of the financing unit.

The end of China Evergrande is near, and foreign investors face a long, and likely bumpy, road trying to recover billions of dollars of their investments in the beleaguered property developer. The process will serve as a lesson for fund managers of the potential risks in investing in China’s distressed assets, WSJ Pro Bankruptcy reported. On Monday, Hong Kong’s high court ordered the liquidation of Evergrande, putting an end to repeated extensions trying to save the company from being dissolved. But obstacles remain for overseas creditors eyeing proceeds from the sale of assets to recover scraps of their investments in the developer. In total, there are nearly $20 billion of dollar-denominated bonds involved in Evergrande’s restructuring. As things stand, the bonds are worth pennies on the dollar. Investors outside China who hold the debt aren’t likely to recover anything more than that, and it will take years for any recovery. Obstacles standing in the way of Evergrande’s offshore creditors include legal uncertainty over whether the Shenzhen-based company will enforce the Hong Kong court’s order. Hong Kong is a separate jurisdiction from mainland China where the majority of the assets are located.

Property developer China Evergrande Group has been ordered to liquidate by a Hong Kong court, bringing an end to the yearslong saga of a company whose default rippled through the world’s second-largest economy, WSJ Pro Bankruptcy reported. The liquidation order came despite an 11th-hour push by the company’s creditors to reach a deal over the weekend, according to people familiar with the matter. It comes more than two years after the company defaulted on its dollar bonds, becoming one of the first dominoes to fall in China’s beleaguered real-estate sector. “The time is for the court to say enough is enough,” said Judge Linda Chan in Hong Kong’s high court. The judge said that Evergrande was given another adjournment in December to come up with a new restructuring deal, seek comments from the creditors, and get a legal opinion on the proposal. “None of that has happened,” Chan said. Evergrande’s lawyer argued for another adjournment, saying that an immediate liquidation order would affect the value of the company’s offshore assets and subsidiaries, thereby damaging the potential recovery rate for creditors. But a lawyer for the main creditors group argued that Evergrande hadn’t negotiated with them in good faith, and the judge agreed.

Brazilian airline Gol does not expect its chapter 11 proceedings to trigger job cuts, its chief executive said on Friday, reiterating that the carrier's operations will remain as usual while it is under bankruptcy protection, Reuters reported. Gol, Brazil's second-largest airline in terms of passengers transported, filed for bankruptcy protection in the United States on Thursday as it grapples with high debt seen at around 20 billion reais ($4.07 billion). CEO Celso Ferrer in an interview with CBN radio said that the carrier's main goal with the move is to restructure its balance sheet so it can grow again. "There will not be layoffs related to this process. From now on we want to grow," Ferrer said, adding that operationally the carrier has been seeing a "significant recovery" after positive results in recent quarters. Gol is the latest in a series of Latin American carriers to seek bankruptcy protection after the COVID-19 pandemic, following the path of sister company Avianca, Mexico's Aeromexico and Chile-based LATAM Airlines.