Air France-KLM and Apollo sign a definitive agreement for a

Paris, Julythere 13e 2022

Air France-KLM and Apollo sign a definitive agreement for one EUR 500 million investments in a ad hoc Operating affiliate of Air France has spare engines

Air France-KLM and Apollo Global Management (NYSE: APO) today announced the signing of a definitive agreement allowing the funds and entities managed by Apollo to invest 500 million euros in a ad hoc operating subsidiary of Air France which will hold a fleet of spare engines dedicated to the company’s Engineering and Maintenance activities.

As part of this agreement, Apollo-affiliated entities will subscribe to perpetual bonds issued by the ad hoc operating subsidiary, which will be recognized in equity under IFRS. The proceeds of the transaction will allow Air France-KLM and Air France to pursue the reimbursement of the perpetual bonds of the French State, in accordance with article 77 bis of the “Temporary framework for State aid aimed at supporting the economy in the current context of Covid-19” from the European Commission. 19”, thus continuing the purchase of French State aid.

Thanks to the transaction, Air France-KLM will benefit from lower financing costs. The perpetual bonds will bear an interest rate of 6% for the first 3 years, with incremental increases and caps thereafter. Air France will have the possibility to redeem the bonds at any time after year 3.

This structure will not entail any change in ownership, operational or social aspects of Air France’s Engineering and Maintenance activity. In the future, it could also help fund the acquisition of additional spare engines to support Air France’s fleet renewal program. There will be no change in the way Air France uses spare engines, and no impact on the contracts of Air France or Air France-KLM employees.

The transaction, which is expected to close later in July, is part of the recapitalization measures announced on February 17e2022.

Deutsche Bank AG and Skadden, Arps, Slate, Meagher & Flom LLP act as exclusive financial and legal advisors to Air France-KLM. Apollo Global Management was advised by Milbank LLP and Jeantet as legal advisors.

Investor Relations

Frederic Kahane Michael Klinkers

33 1 49 89 52 59 +33 1 49 89 52 60

[email protected] [email protected]


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