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Azul Brazil shifts its focus to "responsible Growth" and rules out M&A following Chapter 11

Azul, a Brazilian airline, has emerged from Chapter 11 restructuring, protected from any potential new headwinds. CEO John Rodgerson said that the company will now focus on "responsible" growth, while excluding 'any merger or acquisition plans.

Azul announced Friday that it?had?exited U.S. bankruptcy after approximately nine months. It added that it had accomplished its goals during the process of strengthening its capital, increasing liquidity, and reducing debt.

"I am very happy to be managing this company, now that it has been de-leveraged. Rodgerson stated that the best thing to do is run a business?that has done everything to improve its balance sheet.

Azul filed Chapter 11 in May 2025, to restructure debt. It was part of the wave of Latin American carriers seeking bankruptcy protection after the COVID-19 epidemic. This included rivals Gol Airlines and LATAM Airlines.

The carrier reduced debt and lease obligations of about $2.5 billion, and raised nearly $1.4 billion in debt and $950 millions?in equity investment during the process.

We know that the company with the lowest leverage is going to win. That's it. Rodgerson explained that we live in a country where there are many uncertainties. We have therefore shielded the company so it can withstand any situation.

Azul emerged out of bankruptcy proceedings with a leverage ratio less than 2, down from 3.3 during the pandemic.

UNITED, AMERICAN BACKWARD RESTRUCTURING

American Airlines and United Airlines both invested in Azul as part of its restructuring.

Azul received $100 from United, and signed a contract with American for an additional $100 million equity investment. This is subject to antitrust approval.

Rodgerson stated, "They could've invested anywhere else but chose to join us." "They wanted the connectivity that we have in Brazil."

He added that the restructuring put an end to all merger plans.

In 2025, the carrier held discussions with Abra Group about a possible merger?with Gol which Abra controls. However, these talks ended in September when Azul shifted its focus to Chapter 11. In 2021, it also failed to merge with LATAM.

Rodgerson replied, "Forget it," when asked about the possibility of a merger and acquisition. (Reporting and editing by Anil D’Silva; Gabriel Araujo)

(source: Reuters)