Borrower view: TAM bonds fly high
TAM, Brazil’s leading low-cost airline, is seeking to maintain and improve its position with funding such as its recent 10-year bond. CFO Libano Mirando Barroso talks to Chloe Hayward about the bond and the airline’s business strategy.
Credit crunch? What credit crunch? If the success of recent high-yield corporate bonds out of Latin America is anything to go by, investors are still falling over themselves to get their hands on the riskier end of the credit spectrum. One such credit is TAM, a Brazilian low-cost airline. In April, the company, which is rated BB, issued a highly successful $300 million, 10-year bond that capitalized on keen investor interest and a strong trading environment. The deal will help TAM maintain its leading market position and face up to the challenges that the Brazilian aviation sector and local competitors pose, according to Libano Mirando Barroso, chief financial officer at the airline.
"In order to consolidate and expand leadership with profitability, we intend to maintain our low operational cost strategy, high-quality differentiated services and competitive prices, offering passengers a vast flight network, convenient flight times and high flight punctuality and regularity," says Barroso.