Azul Shares Jump After Deal With Lessors Slashes Debt (1)

Azul’s shares jumped 16% in Sao Paulo trading after the Brazilian air carrier reached an agreement with its lessors and parts suppliers that helps cut its debt load.

The deal allows the airline to slash 3 billion reais ($547 million) of debt in exchange for 100 million new preferred shares, according to a regulatory filing.

“This agreement with lessors should ease the negotiations with other creditors,” Bradesco BBI analyst Victor Mizusaki writes in a note. “The next steps for Azul’s liability management include the raising of additional capital and possibly lengthening the bond maturities.”

Azul has been attempting ...