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According to reports, some $ 500 million in Garuda debt would be restructured with another $ 500 million in new loans to help the airline meet operational needs over the next 6 months.
GARUDA INDONESIA. A plane from the Indonesian aircraft carrier in Yogyakarta on July 30, 2016. Photo by Shutterstock
JAKARTA, Indonesia – Indonesia is drawing up a $ 1 billion rescue plan for the struggling national airline Garuda after the coronavirus forced the company to land most of its planes, Bloomberg News reported Monday, May 11.
Under the plan, some $ 500 million in Garuda debt will be restructured with another $ 500 million in new loans to help the airline meet operational needs over the next 6 months, according to the report, citing the Deputy Minister of State Companies, Kartika Wirjoatmodjo.
The company was facing the possibility of default on Islamic bonds known as sukuk due next month, according to the report, adding that investors will be offered the option to extend the maturities of their investment by 3 years or a scheme. staggered payment.
“Garuda is still a good company with good prospects,” said Wirjoatmodjo.
“His business will remain strong after the outbreak ends.”
The ministry did not respond to requests for comment.
In a response via WhatsApp, Garuda’s chief executive, Irfan Setiaputra, said: “This is still an ongoing discussion. It is not yet confirmed.”
State-controlled Garuda, which operates a fleet of more than 200 planes with its subsidiary Citilink, has temporarily cut wages to help cope with a travel crisis caused by the global pandemic.
The coronavirus has dealt a severe blow to the global aviation industry, which has been hit hard by confinement measures and travel restrictions.
Avianca de Colombia, the second largest airline in Latin America, filed for bankruptcy on Sunday, May 10, in an attempt to reorganize its debt. – Rappler.com
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