“The US Chapter 11 financial reorganization process provides a clear and guided opportunity to work with our creditors and other stakeholders to reduce our debt, address the business challenges that we, and others in our industry, face in as a group, “said the company. “It is very different from the concept of bankruptcy in other countries and is not a liquidation procedure. “
LATAM CEO Roberto Alvo cited travel restrictions related to the coronavirus as one of the main drivers of the bankruptcy decision.
“We envision a post-Covid future and focus on transforming our group to adapt it to an evolving new way of flying, the health and safety of our passengers and employees being paramount,” said Alvo in an infographic. explaining bankruptcy.
The voluntary reorganization will include LATAM subsidiaries in Chile, Peru, Colombia, Ecuador and the United States.
It is the second major airline in the region to file for bankruptcy in May. Avianca, based in Colombia, filed for bankruptcy in the southern US district of New York after experiencing financial problems related to coronaviruses.