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Colombian Airline Avianca Files for Bankruptcy

: May 12, 2020 - : 1:20 am

Another major international airline has gone bust in the wake of the coronavirus pandemic.
Colombian airline Avianca (AVH) filed for Chapter 11 bankruptcy in the US Southern District of New York on Sunday, blaming its collapse on the “unforeseeable impact of the Covid-19 pandemic,” according to a company statement.

“Despite effective debt reprofiling in 2019 and successful execution of its “Avianca 2021″ plan through mid-March, speed and scale of dramatic COVID-19 crisis impact necessitates Avianca’s Chapter 11 fling in New York,” read the company statement.

Court-supervised process is intended to continue Avianca’s operations, preserve jobs, maintain connectivity for Avianca’s more than 30 million annual passengers, and promote economic recovery in Colombia and company’s other core markets
Avianca said that it is committed to continue serving customers with safe, reliable air travel and high-quality service as COVID-19 travel restrictions are gradually lifted.
The company is in discussions with governments regarding financial support for successful process.
Avianca, which was founded in 1919, claims to be the world’s second-oldest continuously running airline. As of the end of last year, it was the third-largest airline in Latin America based on market share, after Chile’s LATAM Airlines (LTM) and Brazil’s GOL Linhas Aéreas (GOL), according to Euromonitor.

The carrier is also part of the Star Alliance, the industry group that includes other big players such as Lufthansa (DLAKY) and Singapore Airlines. Last year, a holding company affiliated with United Airlines (UAL) bought a majority stake in Avianca.

Avianca is the latest major airline to succumb to the loss of business from the pandemic, which has caused carriers to rip up their flight schedules, ground planes and put staff on unpaid leave.

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