Avianca Holdings is a Latin American airline holding company formed in February 2010 by the merger of two airlines, Avianca from Colombia and TACA Airlines from El Salvador.

Avianca Holdings has outlined today its proposed debtor-in-possession (DIP) financing, wherein it aims to raise around USD1.2 billion in fresh capital and increase its stake in its LifeMiles loyalty program.

The airline holding said it had reached conditional agreements with various parties to provide funding for the plan which will require two tranches totaling USD900 million and USD316 million respectively.

The first tranche would also include a roll-up of USD220 million in existing commitments, as well as USD168.5 million of debt issued to Advent, LifeMiles’ 30% shareholder. In return for the portion of the debt and an additional USD26.5 million in cash, Avianca Holdings plans to acquire a 19.9% share from Advent with an option to buy the remaining 10.1% in the future. The group already controls the remaining 70% of LifeMiles.

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