NASSAU, Bahamas--(BUSINESS WIRE)--Kingsland Holdings Limited (“Kingsland”), minority shareholder of Avianca Holdings S.A. (“Avianca”), today issued a statement in response to court filings seeking to deny Kingsland’s request for expedited discovery. Kingsland is pursuing this discovery in connection with its motion for preliminary injunctive relief to prevent Avianca’s controlling shareholder, Synergy Aerospace Corp. (“Synergy”), and Germán Efromovich from proceeding with their unlawful attempt to force through a transaction with United that primarily benefits Efromovich and Synergy.
“In its papers, Synergy concedes that it is actively negotiating with United to obtain a loan for itself as part of a United-Avianca transaction, just as Kingsland has alleged in its lawsuit. Synergy merely disputes the terminology used to describe the negotiations and the amount of the loan being discussed, yet any loan at all is improper and damaging to Avianca and its shareholders. Synergy has conceded a fact central to Kingsland’s request for an injunction. As alleged, Synergy is using its control of Avianca to extract benefits from United that flow to Synergy, not to Avianca, as part of the price for United to enter a joint venture with Avianca. Synergy is seizing for its benefit a corporate opportunity – United’s willingness to pay hundreds of millions of dollars for a joint venture – that rightfully belongs to Avianca and all of its shareholders. These actions pose significant risks to Avianca and compelled Kingsland to take steps to protect the airline and its minority shareholders from further harm.”
On February 28, 2017, Kingsland filed a lawsuit in New York State Court challenging Synergy’s and Mr. Efromovich’s conduct with respect to Avianca.
As a significant shareholder, Kingsland Holdings is deeply committed to the long-term success of Avianca and is pursuing this action to protect the viability of the company and safeguard the interests of all minority shareholders. Unfortunately, Germán Efromovich does not share this commitment to Avianca. Ignoring his fiduciary duty to Avianca’s shareholders, he is negotiating a self-serving deal with United Airlines under which hundreds of millions of dollars from United will flow directly to his holding company, Synergy Aerospace Corporation, with potentially none of the proceeds from the transaction benefitting Avianca. This is only the latest example of Germán Efromovich’s self-dealing at the expense of other shareholders, and Kingsland is determined that it will be his last.