South American airline Latam Airlines filed for bankruptcy protection on Tuesday, while trying to manage the sharp decline in air travel caused by the coronavirus pandemic.
Latam Airlines Group S.A., based in Santiago de Chile, indicated that both the company and some of its subsidiaries had initiated a restructuring in the United States.
The operator hoped to continue operating and was confident of reducing its debt through the bankruptcy process.
Passenger and freight flights would continue to operate and employees would continue to receive their wages, the firm said. Passengers with tickets and coupons could still use them.
The company’s CEO, Roberto Alvo, described Latam as “healthy and profitable” before the pandemic that has paralyzed flights around the world.
“We are looking forward to a future COVID-19 post and we focus on transforming our group to adapt to a new and evolving way of flying, with the health and safety of our passengers and employees as fundamental,” he said in a statement. announcing the bankruptcy.
The process included the parent company and its subsidiaries in Colombia, Peru and Ecuador, as well as its operations in the United States.
Latam did not include its subsidiaries in Argentina, Brazil and Paraguay. The company said it is in talks with the Brazilian government about how to proceed with its operations there.
The bankruptcy protection request was supported by two families with significant participation in the company – the Cueto family in Chile and the Amaro family in Brazil – as well as the investor Qatar Airways, which has a 10% stake, the company said. firm.
Latam is the largest operator in South America due to passenger traffic. Last year it operated more than 1,300 daily flights and carried 74 million passengers.
The firm had a fleet of more than 340 aircraft and almost 42,000 payroll employees, according to its latest annual balance. In 2019 it reported profits of $ 190 million.
Latam reached an agreement last year to sell a 20% stake to Delta Air Lines for $ 1.9 billion. His statement Tuesday did not mention the Atlanta-based company.
Delta CEO Ed Bastian expressed confidence in Latam’s management in a statement mailed in response to questions.
“Airlines around the world have been devastated by the COVID-19 pandemic, for which no business plan could have adequately prepared. We remain firmly committed to our alliance with LATAM and believe it will succeed as a stronger airline. and a long-term Delta partner, ” she said.
It did not say whether Delta would provide more financial support, and the company declined to comment further.
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