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Azul SA, one of Brazil’s largest airlines, is tapping the local debt market for about $325 million of convertible debt with the backing of U.S.-based investment funds Knighthead Capital Management and Certares Management, Bloomberg reported. The five-year bonds are denominated in Brazilian reais but indexed to the dollar. Knighthead and Certares are supplying $300 million, which comes from a $1 billion joint fund they created this year to invest in the travel industry, a sector that’s been decimated by the COVID-19 pandemic. The remaining $25 million is being absorbed by the local market. The sale gives low-cost carrier Azul an added cushion as it navigates a drop in air travel that’s prompted Chapter 11 bankruptcies for three of the region’s largest airlines — Latam Airlines Group SA, Avianca Holdings SA and Grupo Aeromexico SA.

With the COVID-19 pandemic grinding international travel to a halt, experts on an online panel at ABI’s International Insolvency Forum set for Nov. 18-20 will provide their insights into distressed non-U.S. airlines filing for chapter 11 protection, and how their cases may differ from domestic carriers. Click here to register. 

Money owed to aircraft lessors and some creditors of South African Airways (SAA) is not covered by a 10.5 billion rand ($665 million) government bailout, SAA’s administrators said, Reuters reported. South Africa’s government allocated the latest cash injection for SAA in last month’s mid-term budget, but says it will not put further money into the airline. SAA’s administrators told Reuters on Thursday that 1.7 billion rand owed to lessors and 600 million rand that it owes to creditors from before the airline went into administration nearly a year ago would not be covered. That could complicate government talks with prospective investors in SAA, which has not made a profit since 2011. They said that the additional debts are “only payable from next July and will be paid over a three-year period,” so the bailout money only covers “initial commitments.” The administrators forecast in June that SAA would lose more than 6 billion rand over the next three years. Some analysts expect greater losses given the damaging impact on air travel of the COVID-19 pandemic. Click here.

With the COVID-19 pandemic grinding international travel to a halt, experts on an online panel at ABI’s International Insolvency Forum set for Nov. 18-20 will provide their insights into distressed non-U.S. airlines filing for chapter 11 protection, and how their cases may differ from domestic carriers. Click here to register. 

Boris Becker, a six-time Grand Slam champion and former No. 1 ranked player, has been charged with failing to hand over trophies and medals as part of his bankruptcy filing from 2017, the BBC reported. Becker appeared in a London court on Thursday and faces a total of 28 charges, including for not turning over the hardware to pay debts. It includes Wimbledon and Australian Open trophies. Becker entered court already facing 19 charges for failure to comply with legal obligations to disclose information, per the Guardian. Nine more charges were added on Thursday alleging he hid the trophies and medals so they could not be sold. One new charge relates to hiding the 1985 Wimbledon trophy, per the Guardian. Becker was the youngest Wimbledon men’s singles champion when he won it at the age of 17 years and seven months. He was also the first German and the first unseeded winner. Another charge is for the 1989 Wimbledon trophy. He also won at Wimbledon in 1986. Becker is also accused of hiding two President’s Cups (1985, 1989), a 1988 Davis Cup gold coin and 1989 Davis Cup trophy, both Australian Open trophies (1991, 1996) and a 1992 Olympic gold medal.

U.S. firm Syncapay Inc. has bought the North American unit of German payments company Wirecard AG, Wirecard’s insolvency administrator said yesterday, Reuters reported. The deal is backed by private investment management firm Centerbridge Partners, which is making a majority equity investment in Syncapay, and existing Syncapay shareholders like Bain Capital Ventures and Silversmith Capital Partners, the statement added. Wirecard North America had put itself up for sale late in June after its troubled parent firm filed for insolvency. The unit had said back then that Wirecard North America was a separate legal and business entity of Wirecard and was “substantially autonomous” from the German company. Wirecard collapsed in June after a 1.9 billion euro ($2.25 billion) hole was discovered in its books in what has been Germany’s biggest post-war corporate fraud. Wirecard North America has been re-branded as North Lane Technologies and combined with a Syncapay subsidiary named daVinci Payments, the parties said in a separate statement.

A court-appointed receiver plans to sell paintball equipment makers G.I. Sportz Inc. and Tippmann Sports after they defaulted on $29 million of debt, Bloomberg News reported. Quebec-based G.I. Sportz, identified in Canadian documents last year as the largest global manufacturer and distributor of paintball-related products, has “no ability to repay” the $29 million it owes under a credit agreement, according to a sworn statement from the company’s receiver. A judge in Quebec on Thursday handed broad control of the firm’s finances to consulting firm KSV Advisory, bankruptcy court papers show. G.I. Sportz offers a variety of paintball equipment, including ammo, protective gear and apparel, as well as the gas-powered guns used to the play the sport. Tippmann sells some of the sport’s most popular guns, called markers. The company is majority owned by private equity firm Fulcrum Capital Partners. The firm is part of a partnership that in September took over as lenders to G.I. Sportz, replacing Bank of Montreal. The partnership demanded repayment four days after becoming the lenders, court papers show. G.I. Sportz has struggled in recent years, racking up more than $45 million of losses since the end of 2018. The Covid-19 pandemic made matters worse, as social distancing regulations curtailed paintball games, which are often played in teams in relatively small areas. The court-appointed receiver, Fulcrum and an entity called Kore Outdoor Inc. are nearing a deal that would have Kore buy G.I. Sportz’s operations and keep the business alive. Kore would pay with a note “equal to the value” of the assets and take on the outfit’s secured debt, court papers show. G.I. Sportz employs 235 people. The businesses filed for chapter 15 bankruptcy in Delaware on Friday, a move that protects a firm’s U.S. assets while it works out a restructuring in Canada.

A U.S. judge said bondholders have valid claims over Venezuela’s prized oil refiner Citgo Petroleum Corp., dealing a blow to the country’s U.S.-backed opposition leaders and putting the company at heightened risk of a forced takeover, WSJ Pro Bankruptcy reported. Bondholders are entitled to seize and sell the controlling stake in Citgo that Venezuela pledged to them as collateral in a 2016 debt deal, U.S. District Judge Katherine Polk Failla in New York ruled Friday. No such sale can occur under current U.S. sanctions on Venezuela, though bondholders have been lobbying the Trump administration for an exemption that would permit them to foreclose on the company. Investors and multinational companies trying to collect debts from Venezuela have long been circling Citgo, viewing it as a promising way to get repaid despite the country’s economic meltdown. As a Houston-based company, Citgo is the only meaningful asset belonging to Venezuela they can reach through the U.S. court system.

France plans to raise 20 billion euros ($23 billion) in quasi-equity loans for small firms hit by the coronavirus crisis by offering investors a state guarantee against the first 2 billion euros in losses, officials said, Reuters reported. Fearing failures among firms that were already saddled with record levels of debt before the crisis, the French government wants the program up and running by early next year as it battles the economic impact of the COVID-19 pandemic. Under plans to be presented to the financial sector on Monday, banks would first lend to small and mid-sized firms and then sell 90 percent of the loans to institutional investors. That would limit banks’ risk exposure to 10 percent of the loans while also steering funds to viable firms. Since a public guarantee is involved, EU state aid regulators have to give the program their blessing, particularly the interest rate that would be charged. “The discussion is going well, the European Commission is very interested in the program, but we haven’t landed on a precise number yet,” a finance ministry source said.

Apollo Global Management Inc. won court approval to provide a $1 billion bankruptcy loan for Grupo Aeromexico SAB, paving the way for the airline to proceed with its restructuring plans, Bloomberg News reported. The decision resolves a clash between Apollo and a group of bondholders while bolstering Aeromexico’s efforts to weather an unprecedented collapse in air travel. The disagreement had prompted a bankruptcy court in New York to delay a key hearing on the debtor-in-possession financing four times. Under the new pact, the minority lenders will be able to decide whether they want to convert their loans into equity, Timothy Graulich, a lawyer for Aeromexico, said Friday at the hearing. As the majority lender, Apollo will also be able to convert. Aeromexico, which unlike U.S. airlines hasn’t received government aid to help it through the coronavirus pandemic, filed for court protection three months ago as demand for flights tumbled. The airline’s passenger totals are still less than half their year-ago levels, with customers on lucrative international flights down 84 percent last month.