Air France-KLM In Discussions With Apollo Global Management For €500M Financing

Air France-KLM AFLYY and Apollo Global Management Inc APO are in talks about a €500 million financing of a dedicated operating affiliate owning Engineering and Maintenance assets.
This financing will be non-dilutive, structured through a quasi-equity financing instrument. Proceeds will be allocated to general corporate purposes.
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The instrument would qualify as equity under IFRS, strengthening Air France-KLM’s and Air France’s balance sheets.
Additionally, Air France-KLM announced its first-quarter FY23 results. It reported strong demand in the quarter, with 19.7 million passengers onboard, up 35% versus 1Q22.
Q1 Group revenues were €6.3 billion, an improvement of 42% YoY.
Operating loss was a €(0.3) billion, with an operating margin of -4.8%, above 1Q22 of -7.9%.
Net debt/EBITDA ratio at 1.5x versus 1.8x end of 2022.
The company ended the quarter with a positive adjusted operating free cash flow of €0.7 billion and solid cash at hand at €9.7 billion.
Q1 Capacity +19.8% Y/Y, Traffic +38.9% Y/Y, load Factor was 86.1%, up 11.8 points, and Passenger unit revenue per ASK +36.9%.
Price Action: APO shares closed lower by 4.74% at $58.04 and AFLYY lower by 0.60% at $1.67 on Thursday.

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