By Chayut Setboonsarng, Reuters News
Thai Airways International Pcl won court approval on Tuesday for restructuring its $12.9 billion debt load as the airline that is already under bankruptcy protection seeks to turn around its fortunes.
The court ruling removes the last hurdle to the implementation of the plan, seen as critical for the carrier which last year posted a record loss of about $4.5 billion.
The Central Bankruptcy Court in Bangkok said in its order it approved the rehabilitation plan. The court did not make any changes to the plan that was previously approved by creditors.
A hearing was postponed after two complaints were filed against the plan by certain creditors.
“We are satisfied with the decision,” Somboon Sangrungjang of law firm Kudun and Partners, which represents 87 saving cooperatives, told Reuters.
The plan covers the airline’s debt of 400 billion baht ($12.86 billion), he said.
A committee of five, including the airline’s acting chief executive Chansin Treenuchagron and its former CEO, Piyasvasti Amranand, will administer the plan.
Piyasvasti helmed the airline the last time it was profitable in 2009 to 2012.
The airline was in difficulty well before the coronavirus pandemic grounded many flights across the globe, booking losses nearly every year after 2012.
The restructuring plan, which relies heavily on debt extensions and debt-to-equity conversions, limits most of the haircuts to late interest payments.
The carrier said in March it plans reduce its fleet size to 86 jets by 2025 from the current 103. Thai Airways says it has cut 30 billion baht in expenses.
The Thai government holds a 47.86% stake in the carrier, but it is not governed by the country’s state-enterprise law.
Thai Airways is due to hold a news conference later on Tuesday.
The airline this month resumed routes between European cities and the resort island of Phuket in Thailand in anticipation of a government scheme to allow vaccinated tourists to skip a mandatory quarantine.