Easyjet working with restructuring heavyweights Alix Partners to reduce debt pile

posted on 1st December 2020 by Eddie Saunders
Easyjet working with restructuring heavyweights Alix Partners to reduce debt pile

By Edward Thicknesse, cityam.com

Low-cost carrier Easyjet is working with restructuring heavyweights Alix Partners in an attempt to refinance its hefty debt pile.

The Telegraph first reported that the FTSE 250 carrier had asked the US firm for help as it is faced with paying back £1.4bn in debt to various lenders.

The airline must repay a £600m loan from the Bank of England under its Covid Corporate Financing Facility, as well as £800m to various banks.

The refinancing attempts come after Easyjet announced its first ever full year loss of £1.3bn earlier this month, as the pandemic decimated air travel.

Alix Partners is one of the world’s foremost restructuring firms. It is currently working with Cineworld and Cafe Rouge-owner Casual Dining Group, both of which have been forced into drastic action by the pandemic.

The carrier confirmed it had been working with Alix Partners since May.

Over the course of the last financial year, Easyjet has raised over £2.4bn in liquidity in a bid to see out the coronavirus crisis, including £600m from the sale and leaseback of aircraft.

But back in October the carrier warned that it would need additional state funding if it was to survive.

Speaking to City A.M. after the publication of its final year results, chief exec Johan Lundgren confirmed that the airline was in constant communication with various European governments over the possibility of extra funding.

Unlike European carriers such as Lufthansa and Air France, Easyjet and its peers in the UK have not been able to access massive taxpayer-backed bailouts.

The UK Treasury has said that any such bespoke funding would only be available once airlines had exhausted all other options for raising money.

City sources told the Telegraph that the airline was seeking a combination of new state support and extra bank loans.

A spokesperson for Easyjet said: “Easyjet has been working with Alix Partners since May and they have been providing advice and modelling for the purposes of cash management and forecasting.

“Easyjet will continue to review its liquidity position on a regular basis and will continue to assess further funding opportunities, should the need arise.”