Brazil’s Azul says it prioritizes commercial solutions after report over debt options

Brazilian airline Azul stated on Thursday that a recent Bloomberg report saying the company was weighing options to address approaching debt obligations was "wrongly interpreted", adding the firm prioritizes commercial solutions.

Bloomberg reported on Wednesday that Azul is eyeing alternatives from an equity offering to a Chapter 11 filing, citing people familiar with the matter.

Brazil-traded Azul shares had been falling more than 23% on Thursday, on the back of the report, but cut some losses since Azul issued a statement in the afternoon to trade about 18% down.

In the statement, Azul said it "always prioritize friendly and commercial solutions", adding it has alternatives to raise capital including using its cargo unit as a primary guarantee of up to $800 million or potentially through credit lines with government support.

Azul also said it is in "active talks" with main stakeholders to optimize its equity structure as part of an already disclosed plan, with stakeholders, in general, showing support for it.