Avianca Assets Drop After Colombia Court Blocks Government Loan
(Bloomberg) -- Avianca Holdings SA assets fell Monday after a Colombian court temporarily blocked a $370m government loan to the bankrupt air carrier.
*Shares fell as much as 11.7% in Bogota trading to 189 pesos (5 cents), the lowest since since Aug. 27
*Bonds due in 2023 dropped to 16.99 cents on the dollar, the lowest since June 1
*Company said in a filing that it will demonstrate that loan is beneficial for the country
*“The loan from the government is part of the USD 2 bn DIP financing, which has to be approved by the U.S. court as a whole. The proceeds will be used to fund working capital during the company’s restructuring process. Hence, a delay in the DIP financing disbursement would affect the recovery in Avianca’s operations”; Lucror Analytics analyst Josseline Jenssen wrote in a note
By Ezra Fieser