one of Brazil’s largest airlines, announced today that it has voluntarily filed for Chapter 11 protection in the U.S. Bankruptcy Court for the Southern District of New York. This strategic move is part of a prearranged plan aimed at reducing $2 billion of debt and reinforcing the company’s financial foundation for future growth.
With strong backing from its existing bondholders, its largest aircraft lessor, and strategic partners United Airlines and American Airlines, Azul’s restructuring plan is designed to support ongoing operations while strengthening long-term competitiveness.
“Our decision to enter Chapter 11 is a proactive step toward building a more resilient and future-ready Azul,” said John Rodgerson, CEO of Azul. “While we, like many others in the industry, were impacted by COVID-19, supply chain disruptions, and broader macroeconomic pressures, this process will enable us to emerge stronger and more capable of delivering exceptional service to our customers and value to all stakeholders.”
Azul has secured commitments for $1.6 billion in debtor-in-possession (DIP) financing from current stakeholders. This includes $670 million in cash liquidity to support operations and partially repay prepetition debt. In addition, the company plans to launch a new rights equity offering, with proceeds dedicated to repaying the DIP loans.
As part of the restructuring plan, United Airlines and American Airlines will provide a combined $300 million in equity investment, further underscoring their commitment to Azul’s future.
The reorganization will allow Azul to right-size its fleet and optimize lease obligations, all while continuing regular operations across its extensive network. The airline currently operates a fleet of 200 aircraft, employs approximately 15,000 crewmembers, and serves over 150 destinations on 300 routes.
Azul is being advised by Davis Polk & Wardwell LLP, White & Case LLP, and Pinheiro Neto Advogados.
The lead case is In re: Azul S.A., Case No. 1:25-bk-11176, filed in the U.S. Bankruptcy Court for the Southern District of New York.
