Air France-KLM Launches Tender Offer for Notes Repurchase and Plans New Notes Issue

Air France-KLM announced a tender offer for the repurchase of two existing note series and expressed plans to issue new notes, contingent on market conditions. The tender offer aims to repurchase €750 million 1.875% notes due in January 2025 and €500 million 3.875% notes due in July 2026, with an aggregate principal cap set at €350 million, which may be adjusted by the company.

The debt refinancing strategy involves the issuance of new Euro-denominated, unsecured, fixed-rate notes under a Euro Medium Term Note Programme totaling €4,500,000,000. These new notes are anticipated to be rated BBB- by Fitch and BB+ by S&P. The proceeds from these notes will go towards purchasing a portion of the existing notes and providing funds for general corporate uses.

This maneuver is part of a broader debt management strategy by Air France-KLM, following the company’s credit ratings update in December 2023. The tender offer and new note issuance are designed to enhance the company’s maturity profile.

The final decisions on the acceptance of the tender offer will remain at Air France-KLM’s discretion. The offer is scheduled to terminate on May 21, 2024, with results expected the following day, conditions permitting. These actions are aligned with regulatory compliances asserting that the new notes will target qualified investors in specified regions and are not being offered to the U.S. market.