Gogo will prepay its lenders the $100m principal amount of its outstanding term loan. The notice of payment is expected to be set up tomorrow (May 3rd), according to the firm.
The business aviation broadband connectivity service provider said that the decision to make the prepayment will permanently reduce Gogo’s debt and strengthen the company’s financial foundation.
As a result of the prepayment, Gogo will reduce outstanding debt to $612.3m. The transaction will also reduce the firm’s cash by around $4.5m. As of April 28th, 2023, Gogo had about $188m in cash and an undrawn loan of $100m.
Oakleigh Thorne, chairman and CEO, Gogo said: “As we execute on our strategy and deliver significant free cash flow growth in line with our long-term guidance, Gogo will continue to pursue a balanced capital allocation strategy focused on maintaining adequate liquidity, maintaining an amount of leverage appropriate for the economic environment and enhancing shareholder value.”
He added that investing in initiatives such as Gogo 5G and the firm’s Low Earth Orbit (LEO)-based Global Broadband remains a priority too.
