WASHINGTON (dpa-AFX) - Latam Airlines Group SA, one of the largest air carrier in South America, has filed for bankruptcy protection in New York amid the ongoing Covid-19 pandemic, which has grounded flights worldwide.
This Chapter 11 filing allows Latam to work with its creditors and other stakeholders to reduce its debt, access new sources of financing and continue operating.
Latam, whose shareholders include Cueto and Amaro families and Delta Air Lines Inc., is operating on a reduced schedule. Cueto Group and Qatar Airways have committed $900 million in additional financing. Latam also has about $1.3 billion in cash on hand.
The airline industry has been hardly hit by the coronavirus outbreak, as travel bans were enforced almost all over the world.
LATAM and its affiliates will continue flying as conditions permit throughout the process. Latam's affiliates in Brazil, Paraguay and Argentina aren't part of the bankruptcy case, which was filed in the Southern District of New York.
'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 Officer of LATAM.
Latam has already laid off more than 1,850 employees in Chile, Colombia, Ecuador and Peru in the past couple of months.
Copyright RTT News/dpa-AFX
© 2020 AFX News
