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BANGKOK: Thai Airways International Pcl, the country’s flagship airline, has received judicial approval for the restructuring of its business.
The Central Bankruptcy Court has ruled that the airline can continue with its business reorganization plan, a crucial step for the conflicting company, which has about 350 billion baht (US $ 11 billion) of debt, according to the president. Acting Chansin Treenuchagron.
The flagship airline faces one of its biggest challenges in its 60-year history as the pandemic hits the country’s tourism-dependent economy. The company’s shares rose as much as 10.7%, the most since August 5. Shares of Nok Airlines Pcl, a budget airline in which Thai Airways has a stake, also rose.
The Covid-19 crisis has devastated the global travel industry, forcing airlines to suspend flights, lay off employees and seek financial help from governments and investors.
Virgin Australia Holdings Ltd and Avianca Holdings SA, the second largest airline in Latin America, entered administration or applied for bankruptcy protection.
If the airline is not rehabilitated, it would harm the company, employees, debtors, investors and the entire economy, the court said in a statement after ruling yesterday on the airline’s request.
Industry tensions have been mounting in Asia, with Singapore Airlines cutting around 20% of its workforce.
The court also approved Thai Airways’ request to appoint EY Corporate Advisory Services Ltd and the airline’s board members as debt renewal planners. The airline plans to present a debt plan to the court in the fourth quarter and aims to complete the restructuring process in five years, according to Chansin. – Bloomberg
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