LATAM Airlines, the largest airline in Latin America, has requested bankruptcy in a New York court after the Covid-19 pandemic has grounded flights in this and other regions of the world. The request for voluntary bankruptcy, or Chapter 11 according to US commercial regulations, allows Latam to continue operating while the Chilean company looks for ways to restructure the business and pay its debts.
Major shareholders include the Chilean Cueto family , Delta Air Lines (NYSE:DAL)and Qatar Airways, which owns 10% of the company. It is currently operating at lows and has a cushion of $ 1.2 billion in cash on its balance sheet, in addition to access to another 900 millions in special lines of credit from its shareholders: the Cueto family, the Amaro family and Qatar Airways, according to a statement.
“Airlines globally have been devastated by the COVID-19 pandemic, for which no business plan could have adequately prepared. We remain firmly committed to our partnership with LATAM and believe that it will successfully emerge a stronger airline and Delta partner for the long term,” concluded Ed Bastian CEO of Delta Air Lines said. He did not said if Delta Air Lines will help out financially troubled LATAM.