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A Sky Airlines A320neo (CC-AZC) at Arequipa Alfredo Rodriguez Ballon Airport. (Photo: Sky Airlines)

SKY Airlines Plans to Issue $100 Million In Bonds, Go Public In 2024

SKY, the Chilean airline owned by businessman Jürgen Paulmann, will look to the capital markets for an injection of resources that will allow the carrier to continue flying. For this, SKY Airlines plans to launch the issuance of bonds for up to $100 million.

According to diariofinanciero, the airline has hired the services of the Brazilian investment bank BTG Pactual, which — although it does not carry out many debt issues — will command the process. It is anticipated that all the parties are working at full speed so that its issuance will be during this year. Its placement is expected to be abroad, taking better advantage of the conditions offered by the market.

The bond will be issued with a term of five years in a bullet format, meaning the issuer — in this case SKY — will return the capital in full upon the maturity of the instrument. Additionally, the airline is offering to bondholders that in 2023, the Chilean carrier will go public and bondholders will be able to convert their papers into shares. Finally, within the characteristics of the bond issue, an annual rate of 10% is offered within 5 years.

The future public offering of the airline is based on assumptions that the aeronautical industry will return to pre-pandemic levels in Chile and Peru once a COVID-19 vaccine exists. In that scenario, SKY is expected to publicize up to 40% of its total value, sitting on expectations that the airline’s market value could reach between $400 million and $500 million if sanitary conditions recover. Today the airline is worth no more than $200 million.

The Chilean airline has a debt of around $800 million, 95% of which comes from the financing of the aircraft.

SKY Airlines’ Future Plans

As announced, SKY Airlines received DOT Approval for operations between Peru and the U.S. to transport passengers, cargo and mail from Lima to Fort Lauderdale and Miami. The airline’s intention is currently to start operations during the first half of 2021, using an Airbus A320neo with 186 seats in an all-economy class configuration and would initially involve seven round-trip frequencies per week.

According to latercera, SKY Airlines projects by 2023 to be able to introduce a fleet of Airbus A320neo XLR aircraft, which is the longest-range narrowbody aircraft on the market with the highest fuel efficiency among comparable airliners. The plan is for this fleet to fly non-stop flights like Santiago, Chile to Miami or Lima to New York or Los Angeles. SKY Airlines is the carrier with the newest aircraft in the region, and it will be the first in Latin America to operate this Airbus model by the end of 2023.

With the COVID-19 crisis, SKY went from having a fleet of 26 aircraft to 17, and recently they managed to postpone the delivery of new aircraft between six and 12 months, so only two more aircraft will arrive this year.


  • The three things Juan loves most about aviation are aircraft, airports, and traveling thousands of miles in just a few hours. What he enjoys the most about aviation is that it is easier and cheaper to travel around the world and this gives you the opportunity to visit places you thought were too far away. He has traveled to different destinations in North, Central, South America and Asia. Born, raised and still living in Perú, Juan is a lawyer, soccer lover, foodie, passionate traveler, dog lover, millennial and curious by nature.

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