Avianca’s creditors will now vote on a plan to exchange $935 million in debt for a controlling 72% stake in the carrier, Reuters reports.
Avianca was Latin America’s second-largest airline before the pandemic saw it filing for Chapter 11 bankruptcy protection in the US in May 2020. It is likely to exit bankruptcy by the end of October if investors approve the plan.
The carrier said it had secured $1.6 billion in refinancing and would launch 23 new international routes by 2022 within Latin and North America. Avianca plans to continue its Heathrow-Bogota service.
Manuel Ambriz, chief commercial officer, said: “Launching these 23 new routes shows that we wish to continue growing in a sustainable way, and that we have the firm purpose of continuing to be the airline with the most robust route network in our region.”
Changes will include reconfiguring aircraft with more seats and a “Tailor-Made Travel” programme of ancillary sales.
“We are adapting our offer to provide our customers what they really value: competitive prices, tailor-made products, the best network and trustworthiness in the service,” he said.
Meanwhile, Chile’s Latam, the region’s market leader, said it was also on course to exit Chapter 11 after receiving more than $5 billion in funds. It predicted a return to 2019 profitability by 2024.
Latam also operates in Brazil, Colombia, Ecuador and Peru and flies to Heathrow.
