Brazil airline Gol sinks on debt restructure details

** Shares in Brazilian airline Gol GGOLL3 slump around 15% after board approved a warrant issue for the subscription of preferred shares, giving key details into the carrier's debt restructuring plan

** "We believe that the deal entails a substantial dilution risk," analysts at Itau say

** Controlling shareholder Abra holds the rights to up to $1.4 billion in convertible debt

** Shareholders can claim 4.5 warrants per share at 5.84 reais per warrant under the plan announced on Monday, with the right to subscribe to a new preferred share for 5.82 reais

** Dilution risk could reach 70% to 80%, Itau analysts warn, with total exercise cost reaching 11.66 reais against the 9.36-real closing price

** "Thus, we expect a substantial price correction today," says Itau

** Citi downgrades Gol from buy to neutral/high risk on the news