Aigle Azur files for bankruptcy

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French holiday and charter airline Aigle Azur has been embroiled in a vicious share holder war involving three separate factions demanding things either stay as they are, or new managers or a compromise somewhere in between.

A minority share holder tried to take control of the company and it was forced to file for protective administration in August. French bankruptcy laws are much like US Chapter 11 and allow a company to reorganise and come up with a case to restructure its profile and debt issues.

many would argue that none of that was needed if the minority shareholder, currently subject to a legal challenged from the other groups, hadn’t seemingly over-played their hand.

Meanwhile the airline is intending to continue to function as normal as afar as it can.

Chinese HNA Group, which holds the largest minority stake in the airline, is currently Aigle Azur’s largest shareholder with 48%. Investor David Neeleman, famous for founding airlines including JetBlue, Azul and more, holds 32% in shares. It’s the smallest shareholder grouping that’s caused the problem.

However the airline’s problems are also partly down to the ownership of HNA, who are at best twitchy about being asked for more cash and would much rather sell their holdings. While HNA Group has stabilised it’s finances, it would still sell up to anyone who’d offer it a good return.

Quite how this will resolve itself may be down to a French court, but it’s unlikely to be immediate. What HNA do not want is for their holdings to be diluted or devalued further.

The airline has a longer history than many realise, having been founded in 1946. They currently operate a fleet of seven Airbus A320 and two A330-200 long-haul aircraft, the later having come from AirBerlin on its demise. All are leased from no less than seven different leasing companies.

 

 

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