Aeroméxico (AM, México City International) has been forced to deny media reports that it is preparing to file for Chapter 11 bankruptcy protection in the United States in an effort to stem spiralling losses due to the effects of the coronavirus pandemic.
The column, by business commentator Darío Celis, said on June 19 without citing sources that Aeroméxico had appointed the New York law firm White & Case and Citibank as financial advisers to help with the bankruptcy proceedings.
The aim is to “follow exactly the same steps” as Avianca Holdings and LATAM Airlines Group, which have also filed for Chapter 11 to reorganise their debts without ceding control, the columnist claimed.
“The process to restructure debts is underway,” and the plan is to file the application for protection with the Bankruptcy Court for the Southern District of New York, Celis said.
Grupo Aeroméxico posted a MXN2.58 billion peso (USD114 million) loss for the first quarter of 2020. Mexico’s leftist president, Andrés Manuel López Obrador, has repeatedly denied the group - and shareholders in other large companies - access to taxpayer money. Passenger numbers in May were down 92.4% from what they were in May 2019.
“The company reports that it did not initiate, nor has it made the decision to initiate, a restructuring procedure under Chapter 11 of the Restructuring Law of the United States of America. At this time, we are identifying additional sources of financing to strengthen operating flows,” Aeroméxico retorted in a statement dated June 19.
“We are also analysing different alternatives to successfully achieve, in the short and medium term, an orderly restructuring of financial commitments, without affecting or disrupting operations. The above is in full coordination with unions, creditors, and lessors and in compliance with the obligations derived from our permits and concessions.”
