Air France-KLM and Apollo Global Management completed a transaction for €1.5bn in financing for a new subsidiary dedicated to Air France and KLM’s joint loyalty programme, Flying Blue.
The financing is accounted for as equity under International Financial Reporting Standards (IFRS) and will help restore Air France-KLM’s IFRS equity to positive by the end of the year.
Apollo will subscribe to perpetual bonds with an interest rate of 6.4% for the first four years, with the option for Air France-KLM to redeem them after that period. The structure of the financing will not impact Flying Blue members or the employee contracts of Air France, KLM, or Air France-KLM.
