Business

Largest travel company in Brazil seeks market funding of up to $180 million

CVC has $65 million in cash, but revenue was almost zeroed since the pandemic started

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  • The company said that finances remain solid and that the capitalization will serve to attend demand when it reemerges;
  • The firm’s CEO believes that leisure tourism will return to 2019 levels in early 2023.

CVC, Brazil’s largest travel group, announced on Thursday that it has sought Itaú BBA bank for a funding process. The company does not reveal the amount of money it is seeking to reinforce its coffers, but market analysts estimate that it may exceed BRL 1 billion ($180 million), according to NeoFeed.

The company said its finances remain solid and that the capital investment will serve to “strengthen the balance sheet for sales growth when demand resumes in the coming months”, although health officials cannot say for sure when the Covid-19 pandemics will be over.

READ ALSO: Number of domestic flights dropped 33% in Brazil in March

Currently, CVC has approximately BRL 350 million ($65 million) in cash and another amount in receivables for the coming months. Revenues were practically zeroed in the pandemic.  Total debt is around BRL 1.8 billion ($330 million), with BRL 613 million ($110 million) maturing in November. CVC’s shares accumulate a 66% drop in 2020.

Expectations for 2022

Leonel Andrade, the company’s new CEO, told NeoFeed he believes that the return of leisure tourism to the levels of 2019 should happen in the beginning of 2023. And that of the business segment, including fairs and events, in 2022.

CVC has 1,400 stores, and generates more than 20,000 direct and indirect jobs.