Colombian airline Avianca filed for bankruptcy after filing for Chapter 11 of US law today.
The request states that you request to “voluntarily file Chapter 11 of the Bankruptcy Code of the United States in the Bankruptcy Court of the Southern District of New York, in order to preserve and reorganize the businesses of Avianca. LifeMiles, company that administers the program of the same name is not part of the Chapter 11 application. “
“Despite the effective debt restructuring in 2019 and the successful execution of its” Avianca 2021 “plan until mid-March, the speed and dramatic escalation of the impact of the COVID-19 crisis have led the Company to embrace to Chapter 11 in New York, United States, “the company said.
However, the second largest air group in Latin America emphasized its commitment to “continue serving its clients with safe and reliable air travel and high quality service, as the travel restrictions generated by COVID-19 are lifted gradually”.
RELATED: Avianca negotiates a lifebuoy with the Government of Colombia
He also confirmed that he continues his conversations with governments “regarding financial support for the success of the process.”
Last month a company auditor had reported that there were “substantial doubts” about the airline’s ability to stay in business due to the severe impact of the coronavirus crisis.
The COVID-19 pandemic, which has caused a 90% decrease in global passenger traffic and is expected to reduce industry revenues worldwide.
Today we have announced our voluntary intention to reorganize in the United States of America to preserve and strengthen our businesses for the future. To learn more: https://t.co/2DVXVvsP0w. Avianca # SeguiráVolando pic.twitter.com/NSHMrdVTSH
– Avianca (@Avianca) May 10, 2020
Avianca’s regular passenger operations have been on the ground since mid-March, which has reduced its consolidated revenues by more than 80% and has put significant pressure on its liquidity.
“We believe that the reorganization under Chapter 11 is the best way forward to protect the essential travel and air transportation services we provide in Colombia and in other markets throughout Latin America. Avianca has operated for more than 100 years, becoming the second airline in the world to achieve this milestone. We are confident that through this process we can continue to execute our “Avianca 2021” plan, optimize our capital structure and our aircraft fleet and – with government support – emerge as a better and more efficient airline that will operate for many years to come, “said Anko van der Werff, CEO and President of Avianca Holdings.
READ HERE: FINAL Press Release – Eng.docx Read-Only
– .
