Finance

Debt woes for GOL

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Debt woes for GOL

In the 12 months to June, Gol Linhas Aereas Inteligentes (GOL)’s debt was $1.6 billion – 25 times the airline’s earnings before interest, taxes, depreciation and amortization, or Ebitda. The debt ratio has fuelled speculation the carrier will need to sell assets to raise cash or seek a merger.
Although GOL has cut costs, capacity it is not enough to counter its heavy debt load. To help ease the problem, the airline plans to take its Smiles mileage program public later next year, reports Bloomberg. Before it can launch an IPO, GOL will need to turn Smiles into a separate business.