Colombian Airline Avianca Files for Chapter 11
Colombian airline Avianca has filed for Chapter 11 bankruptcy in the U.S. Southern District of New York citing a fall of more than 80{bcdc0d62f3e776dc94790ed5d1b431758068d4852e7f370e2bcf45b6c3b9404d} in consolidated revenue as flights continue being grounded because of to the COVID-19 pandemic.
In a statement, the organization reported it would use the bankruptcy to balance its sheet obligations to navigate the outcomes of COVID-19 and to deal with liabilities, leases, plane orders, and other commitments. The organization also reported it intends to wind-down its operations in Peru.
In a study report, analysts at the Centre for Aviation reported Avianca was in a “period of upheaval” even before the world-wide well being disaster. In April 2019, CEO Hernan Rincon Lema announced he was leaving the organization soon after 3 a long time in the job.
The organization also noticed a sequence of destructive credit rating scores and a sudden improve in board control. Very last year, the organization announced the “Avianca 2021” program less than which it reprofiled its financial debt and lease obligations. It also elevated $375 million in new financing.
“Avianca is experiencing the most difficult disaster in our a hundred-year background as we navigate the outcomes of the COVID-19 pandemic,” chief executive officer Anko van der Werff reported. “Despite the beneficial outcomes yielded by our Avianca 2021 program, we think that, in the facial area of a total grounding of our passenger fleet and a restoration that will be gradual, coming into into this procedure is a important step to deal with our economic troubles.”
Avianca reported it has “limited visibility” on when vacation constraints would be lifted and it expected the outcomes of the pandemic on vacation to be extensive-lasting.
Avianca, founded in 1919, was the third-largest airline in Latin The us based mostly on market share at the close of very last year, according to Euromonitor.
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