December 10, 2021
Bogotá, Dec 9 (EFE) .- The Colombian airline Avianca began its takeoff after exiting Chapter 11 of the bankruptcy law of the United States as a “revitalized” company, with better financial health and a new business vision, said this Thursday its president, Adrián Neuhauser.
“We have a revitalized Avianca, wanting to grow. We are left with 60% of the debt that we had when we entered Chapter 11 and with three times the cash that we had,” Neuhauser said in a press presentation of the new company.
Neuhauser added that Avianca’s debt was short-term maturities and with the restructuring these obligations went to seven years, which gives them “peace of mind with the capital structure” and at the same time allows them to have “a more efficient cost structure. “.
Avianca filed for Chapter 11 of the US bankruptcy law in May 2020 to emerge from a crisis aggravated by the covid-19 pandemic, and last July it obtained financial commitments for 1.6 billion dollars to finance its reorganization. .
On December 1, the company announced that it had successfully completed its financial restructuring, which allowed it to emerge from bankruptcy “with significantly reduced debt and more than $ 1 billion in liquidity.”
ADAPTATION TO DEMAND
Neuhauser stressed that with the new business vision, Avianca combines the best of its 102 years of existence with the practicality of the low-cost airline model, without implying its transformation into a “low-cost” one.
“We are adapting, recognizing that flying is no longer an option, it is not a luxury, it is part of the basic basket,” he said about the demand for flights, which “accelerated impressively from 2010” and, surpassed the downturn due to the pandemic, it has everything to continue growing.
According to the president of Avianca, there are studies that indicate that in 2027 more than 50% of the Latin American aviation market will be low-cost because “people travel because of the price.”
Published in Finance