Smartwings (Czechia) (QS, Prague Václav Havel) has filed a petition with the Municipal Court in Prague (Městský soud v Praze) for the judicial restructuring of its subsidiary CSA Czech Airlines (OK, Prague Václav Havel), the Czech Republic’s troubled flag carrier which filed for insolvency at the end of February, the Czech News Agency (ČTK) reported citing documents prepared by the insolvency administrator.
Ahead of a crucial creditors’ meeting in the second week of June, Smartwings told the court that it wanted to prevent a situation where CSA loses the right to create its own restructuring plan. Smartwings is itself one of the creditors in the context of the insolvency, with a claim of over CZK350 million koruny (USD16.78 million) out of CSA’s total debts of at least CZK1.8 billion (USD86.3 million).
Proposing that part of the debts would be written off and that the sale of redundant CSA assets be postponed, it offered to prepare a restructuring plan that exploited further synergies between the two airlines. Smartwings owns 97.74% of CSA’s shares, and both are part of Smartwings Group.
According to the law, creditors have the power to take away the preemptive right of shareholders to reorganise a failing company and to decide otherwise if necessary.
According to the proposal, over CZK1 billion (USD48.9 million) of the total debt is owed to passengers for cancelled flights.
Separately, however, Airbus (AIB, Toulouse Blagnac) has filed claims against Czech Airlines totalling almost CZK17 billion (USD815 million) in regard to payments for four A220-300s and three A321-200NY(XLR)s that Czech Airlines ordered in 2019 but never paid for. The A220s had been due for delivery at the end of 2020, but the pandemic came first.
According to insolvency documents, the manufacturer is claiming CZK8.5 billion (USD408 million) in unconditional receivables, the other half being contingent receivables - what it wants the Czech carrier to pay if it withdraws from the order, plus interest and arrears fees.
Having retired all of its ATR72-500s, Czech Airlines currently operates just one owned A319-100 and one A320-200 dry-leased from Nomura Babcock & Brown, the ch-aviation fleets module shows. Smartwings, conversely, operates a fleet of twenty-four B737-800s, two B737-700s, seven B737-8s, and two B737-900ERs. All of these are leased except for one of the -800s.
