Brazil’s Azul takes TAP to court demanding €189 million

The Brazilian airline Azul has filed a lawsuit against the Portuguese airline TAP, demanding payment of around €189 million. This case has arisen because of the non-payment of a bond loan signed in 2016, which expired this month.

According to the news source Observador and confirmed by Negócios on the Citius platform, Azul’s case was filed with the Civil Court of Lisbon on March 13 and was circulated on Monday this week. (March 16). When contacted, neither of the airlines wanted to comment in relation to the case.

This case is already in the Portuguese justice system within the same context as the repayment of the bond loan because the former TAP SGPS holding company changed its name to Siavilo and then was declared insolvent in August last year.

TAP itself filed for Siavilo’s insolvency and it is the main creditor with a debt of around €1.1Bn.

It is believed that TAP transferred all of its positive assets to TAP proper and its toxic assets to Siavilo to give the appearance of wiping any debts off its balance sheets in the run-up to the forthcoming sale of 49% of its capital to any one of three large international airline groups.

At the time the bond loan was made to TAP in 2016, Brazilian-American entrepreneur David Neeleman still owned Azul, having injected €90 million into the Portuguese airline.

At the time of the early repayment request, in June 2025, the Brazilian company claimed a debt of €176.9 million which, however, grew, as it accrued simple and compound interest.

Parpública, the Portuguese State public companies holding, also signed on the 2016 loan, although it wrote off the approximately €60 million it injected into the TAP group.

TAP has always argued that this loan is considered a shareholder contribution, meaning that at did not have to reimburse the €60 million.

The air carrier then took legal action against Azul founded by Neeleman – Neeleman was running both Azul and TAP at the same time -, asking for the contract to be null and void.

TAP, for its part, says that there are no guarantees, which the Brazilian company disputes and has presented correspondence exchanged with the then Minister of Infrastructure, Pedro Nuno Santos, where he indicated that the State would honour the payment.

This case in the Portuguese law courts comes after Azul recently emerged from an insolvency request in the United States, having been saved by its shareholders from United Airlines and American Airlines, after an injection of US$300 million.

Source: Observador/Negócios; Credits: Azul