RIO DE JANEIRO, BRAZIL – Avianca Holdings said on Thursday, November 12th, it has won the support of a large number of institutional investors and existing lenders, meaning it will no longer need the Colombian government’s participation as part of its restructuring process.
Avianca, Latin America’s second-largest airline, filed for Chapter 11 bankruptcy in New York in May. A U.S. bankruptcy court approved a proposed financing plan of over US$2 billion to help the carrier exit Chapter 11 restructuring in October.
The airline was expecting US$370 million in credit from the Colombian government. The move was suspended following a judicial ruling, which Avianca initially looked to appeal.
“Avianca has the financial flexibility at this stage to support its operations and continue its restructuring without participation of the Colombian government,” the company said in a statement.
The decision by Colombia’s government to offer the loan to the airline provoked fierce criticism from opposition politicians and unions. The Colombian government was not immediately available to comment.
Colombia’s flagship airline has a fleet of 158 planes and 19,000 employees. It has routes to 76 destinations in 27 countries in the Americas and Europe. It carried 30.5 million passengers in 2019, generating $4.6 billion in sales.