Airline

LATAM files for Chapter 11 

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LATAM files for Chapter 11 

LATAM Airlines Group announced that it will voluntarily file to reorganise under Chapter 11 protection in the United States in a release to the Chilean stock market.

The Chapter 11 move involves subsidiaries in Chile, Colombia, Peru, Ecuador, the United States of America, the Cayman Islands and the Netherlands. The subsidiaries of Argentina, Brazil, and Paraguay are not included.

In a statement LATAM said that the move came with the support its largest shareholders, the Cueto and Amaro families and Qatar Airways and that the reorganisation process would provide the carrier  with an opportunity to work with the group’s creditors and other stakeholders to reduce its debt, access new sources of financing and continue operating. According to LATAM, its main shareholders would provide $900 million of liquidity once the reorganisation process was complete.

“LATAM entered the COVID-19 pandemic as a healthy and profitable airline group, yet exceptional circumstances have led to a collapse in global demand and has not only brought aviation to a virtual standstill, but it has also changed the industry for the foreseeable future,” said Roberto Alvo, chief executive of LATAM.

“We have implemented a series of difficult measures to mitigate the impact of this unprecedented industry disruption, but ultimately this path represents the best option to lay the right foundation for the future of our airline group. We are looking ahead to a post-COVID-19 future and are focused on transforming our group to adapt to a new and evolving way of flying, with the health and safety of our passengers and employees being paramount.”