Garuda Indonesia has paid $25 million to purchase floating rate notes worth $45 million, after the carrier's noteholders decided to sell at a price less than face-value.
The national carrier is trying to clear debts to improve its balance sheet prior to an initial public offering planned for later this year.
Garuda and the noteholders came to the price via a Dutch auction process, says the airline. In a reverse dutch auction, there is one buyer and multiple sellers, with the auctioneer raising the price from a low starting point until a bidder agrees to sell at that price.
"Garuda plans to launch a similar tender offer to certain lenders holding loans advanced in connection with lease financings of aircraft, with an aggregate purchase price of up to $11 million, in connection with the restructuring of those loans," adds the carrier.
Source: Air Transport Intelligence news