< Reveal sidebar

A LATAM Airlines Boeing 787-9 departing LAX (Photo: AirlineGeeks | James Dinsdale)

LATAM Airlines Files for Chapter 11 Bankruptcy

In a communication addressed to the Chilean Financial Market Commission (CMF), LATAM Airlines Group has announced that it will voluntarily file to reorganize under Chapter 11 protection of the United States Code.

The requested restructuring 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 this procedure.

The Brazilian subsidiary has received a state monetary contribution, but there have been no news or announcements of additional financing for Argentina and Paraguay.

The measure grants an automatic suspension of 180 days of the execution of the unpaid debts, and according to what was expressed in the statement, LATAM will use that time to renegotiate key contracts “adjusting them to current market conditions.” In the same sense, LATAM seeks to “restructure its financial balance and adjust the size of its operations to the new reality.”

The company announced that it obtained financing commitments from shareholders related to the Cueto and Amaro families, and Qatar Airways for $900 million that will be made available once the agreements determined by the special administration are confirmed.

LATAM stated, minutes after announcing the restructuring, that it will continue to operate.

Through a video, Roberto Alvo, CEO of LATAM Airlines Group, sought to bring peace of mind to passengers, “The company states that there will be no impact on cargo, booking, voucher or Latampass miles and points operations. The special site the company prepared ensures that the Chapter 11 financial reorganization process is not a liquidation process.“

Author

  • Since a little kid, Pablo set his passions in order: aviation, soccer, and everything else. He has traveled to various destinations throughout South America, Asia, and Europe. Technology and systems expert, occasional spotter, not-so-dynamic midfielder, blogger, husband, father of three cats; he believes that Latin America's aviation industry past, present, and future offer a lot of stories to be told.

Related Stories

Republic Airways Requests Exemption From 1,500-Hour Rule To Address Pilots Shortage

The airline industry has been worrying for many years about a possible upcoming shortage of pilots to fly all the…

KLM Receives Blame from Unions for Strikes, Chaos at Schiphol Airport this Weekend

With Dutch schools closing for the May holiday on Friday, Schiphol Airport was gearing up for its biggest weekend since…

Kenya Airways Offered $217 Million Debt Reprieve as it Eyes Sustainability Post-Pandemic

Kenya has offered its national carrier Kenya Airways (KQ) a KES25 billion shillings ($217 million) lifeline on unpaid interest, which…