10:57 AM EDT, 08/29/2024 (MT Newswires) -- Azul ( AZUL ) is contemplating a Chapter 11 filing and a potential follow-on offering to address approaching debt obligations, Bloomberg reported Thursday, citing people familiar with the matter.

The Brazilian carrier is also looking at a potential merger with GOL Airlines, with an aim to convince creditors that a unified entity would result in lower debt levels and better growth prospects, the report said.

Azul ( AZUL ) has tapped Citigroup ( C ) in weighing the equity offering option and as an adviser on the potential merger deal with GOL, Bloomberg said.

The company is also considering a debt issue through its cargo unit, according to the report.

Representatives for Azul ( AZUL ) and the US bank declined to comment to Bloomberg, the report said.

Azul ( AZUL ) and Citigroup ( C ) did not immediately reply to MT Newswires' requests for comment.

Shares of Azul ( AZUL ) were down about 24% in recent trading on the New York Stock Exchange.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)

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