MEXICO CITY (Reuters) – Aeromexico said on Tuesday that most of its shareholders agreed with a plan to leave the main stock exchange in Mexico. This is part of the airline’s restructuring as it goes through bankruptcy.
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The company said in a statement that shareholders approved a plan on Monday to stop registering shares and putting them on the stock exchange in order to start a buy-back programme.
Aeromexico went bankrupt in June 2020 after the coronavirus pandemic cut down on the number of people who wanted to travel. It came out of bankruptcy in March with a $5 billion investment plan and changes to its fleet.
Before Aeromexico’s Chapter 11 bankruptcy, Delta Airlines (NYSE:DAL) owned 49% of the company. After the bankruptcy, it only owned 20%. After the company went through Chapter 11, Apollo Global Management (NYSE:APO), a private equity firm, became its largest shareholder.
“Aeromexico used the fact that it was a Chapter 11 debtor to negotiate,” said Katie Coleman, co-chair of Hughes Hubbard & Reed’s (NASDAQ:REED) corporate reorganisation and bankruptcy practise, which was Delta Airlines’ lead counsel in the case.
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Coleman said that because of the talks with the leasing companies, Aeromexico was able to “really optimise their fleet.”
Coleman says that the delisting of Aeromexico was written into the company’s so-called “registration rights agreement” in the Chapter 11 proceedings.
“The old shares of a company are taken away, and the new ones are given out. As part of this process, Mexican law requires that you get off the list “Coleman said.
Aeromexico is the latest Mexican company to become privately owned.
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About 150 companies are listed on Mexico’s main stock exchange. Seven of them, including Grupo Lala, a dairy company, Maxcom, a telecommunications company, and Bio Pappel, a paper company, have recently delisted or said they plan to do so.
