LATAM Airlines Group announced (26-May-2020) a reorganisation plan which includes filing for Chapter 11. LATAM Airlines Chile, LATAM Airlines Peru, LATAM Airlines Colombia, LATAM Airlines Ecuador and LATAM Airlines' affiliate in the US have also filed for Chapter 11. LATAM Airlines Brasil, LATAM Airlines Argentina and LATAM Airlines Paraguay are not included in the filing. LATAM Airlines Group and its affiliates will continue operating with no impact on passenger or cargo operations, reservations, vouchers or LATAM Pass miles. The group secured the financial support of shareholders, including the Cueto and Amaro families, which have lasting ties to LATAM, and Qatar Airways, to provide up to USD900 million in debtor-in-possession financing. In addition, as of the filing, the group had approximately USD1.3 billion in cash on hand. LATAM stated the following:
- LATAM Airlines Group SA and its affiliates will continue to operate passenger and cargo flights, subject to demand and travel restrictions;
- All current and future tickets, travel vouchers and frequent flyer miles and benefits, as well as flexibility policies, will be honoured;
- The group's employees will continue to be paid and receive benefits as provided in their employment agreements;
- Suppliers will be paid in a timely fashion for goods and services delivered from 26-May-2020 forward and throughout this process;
- Travel agencies and other commercial partners will experience no disruption in their interactions with the LATAM group.
LATAM intends to rely on specific relief that will allow it to pay its employees, meet benefit obligations, pay critical suppliers and conduct other day-to-day business operations as the group works with the court and creditors to resolve its case. With Chapter 11 protection, the group's management team will remain in place. LATAM is advised in this process by Cleary Gottlieb Steen & Hamilton and Claro & Cia as legal advisors, FTI Consulting as financial advisor and PJT Partners as investment banker. [more - original PR]