Invictus Global Management Sends Letter to Delta Airlines’ Board of Directors Regarding Apparent Conflicts, Disclosure Issues and ESG Lapses in Aeroméxico Bankruptcy

AUSTIN, Texas--(BUSINESS WIRE)--Invictus Global Management, LLC, which collectively with its affiliates is a sizable creditor in the bankruptcy of Grupo Aeroméxico, S.A.B. de C.V. and a shareholder of Delta Air Lines, Inc. (NYSE: DAL), today released a letter sent to the following Delta directors: Ed Bastian, Francis S. Blake, Ashton B. Carter, David G. DeWalt, William Easter, Christopher A. Hazleton, Michael P. Huerta, Jeanne P. Jackson, George N. Mattson, Sergio Rial, David S. Taylor and Kathy Waller.

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December 20, 2021

Delta Air Lines, Inc.
Department 981, P.O. Box 20574
Atlanta, Georgia, 30320
Attn: The Board of Directors

Members of the Board of Directors:

In addition to being a shareholder of Delta Air Lines, Inc. (“Delta”), Invictus Global Management, LLC (collectively with its affiliates, “Invictus” or “we”) is a sizable holder of general unsecured claims of various debtor entities in the bankruptcy cases of In re Grupo Aeroméxico, S.A.B. de C.V., et al. (Jointly Administered Case No. 20-11563). Invictus and other creditors have spent the past several weeks trying to engage in good faith with Delta to address an array of apparent conflicts, disclosure issues and underhanded dealings facilitated by the airline during the Grupo Aeroméxico, S.A.B. de C.V. ("Aeroméxico" or the "Company") restructuring. You, your management team and your representatives have repeatedly chosen to ignore our outreach and efforts to avert protracted litigation.

Given that we have fiduciary obligations to our own limited partners, we will not sit idly by as Delta tries to ram through a restructuring plan that is underpinned by an opaque economic arrangement with Apollo Global Management, Inc. (“Apollo”) and seemingly egregious financial terms that defy decades of bankruptcy precedent. Delta’s willingness to strike its own self-serving and under-disclosed deal at the expense of vendors, suppliers, employees and other creditors is something we would expect from an unscrupulous vulture fund – not a company that claims to be “purpose-driven” and “a driver of change for diversity, equity & inclusion.”¹ We believe Delta’s largest institutional shareholders will ultimately be appalled upon learning about what has transpired during this process.

While we respect the fact that you – Delta’s directors – collectively have a duty to prioritize shareholders’ interests, we contend Delta’s actions and conduct throughout the Aeroméxico restructuring defy the tenets of sound corporate governance and undermine the environmental, social and governance (“ESG”) principles boldly touted in your shareholder materials. Please be advised that we are taking the following steps to protect our interests:

• Formally objecting to the currently proposed restructuring plan, which enables Delta to obtain unprecedented treatment as an equity holder and join in the Apollo debtor-in-possession financing arrangement following months of non-existent disclosure about the arrangement.

• Sending a letter that outlines our concerns pertaining to Delta’s apparent conflicts to the U.S. Trustee.

• Making our elected congressional representatives aware of our concerns, as is our right as a constituent.

• Sharing our views with fellow Delta shareholders, as is our right as a shareholder.

• Preparing a books and records request that will ideally allow us to determine the extent to which directors authorized or were aware of Delta’s actions and disclosure decisions over the past 14+ months.

While we infer from your silence to date that Delta would rather remain in the shadows during this process, it is clear that daylight needs to shine on the actions and decisions that could position you to make hundreds of millions of dollars at the expense of other stakeholders, including the many who stand to be economically crushed under the plan preferred by Delta and Apollo. At the very least, Delta’s actions in recent months indicate its broad-based ESG efforts are completely hollow – a fact that stewardship groups at large asset management institutions will surely take note of.

If you opt to finally engage with us about a solution, we remain ready and willing to work towards a compromise that treats all Aeroméxico stakeholders equitably.

Sincerely,

Cindy Chen Delano
Co-Founder and Partner
Invictus Global Management, LLC

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¹ Article entitled “Delta's ESG Report: Powering purpose-driven goals to be a catalyst for change,” May 6, 2021.