COVID-19: Thai Airways wins court approval to restructure massive debt
Updated
Embattled carrier Thai Airways secured a debt payment break as Thailand’s Central Bankruptcy Court approved a restructuring plan to help the airline survive the COVID-19 hit to its business.
On 19 May more than 90% of Thai Airways shareholders approved a restructuring plan that would see a three-year freeze on loan payments and a six-year moratorium on its bond repayments in a debt load totalling THB488 billion (US$12.7 billion) .
The Thai courts green lit this proposal, according to a statement posted to the Thai stock exchange on Wednesday.
Holiday hotspot
Holiday hotspot Thailand has seen a dramatic fall in tourism numbers as result of government imposed pandemic restrictions - just 57,000 high-spending Chinese tourists visited the Kingdom in March 2020 - versus 985,000 for the same month one year earlier.
This led to Thai Airways posting a record THB141 billion loss in 2020, however, this came on the back of losses every year since 2017. While the Thai government has supported a number of local low cost airlines it has so far refused to bailout the flag carrier.
However, according to Reuters, the airline is in talks with government and private financial institutions over THB50 billion of new funds. Leasing agreements for 16 jets have also been cancelled and negotiations over these debts are ongoing.
Phuket sandbox
The Thai government is looking to tentatively restart local tourism via the so-called Phuket Sandbox as it allows vaccinated visitors to holiday on the island from July.
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Read more: Thai Airways creditors approve restructuring plan
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