Cash strapped Thai Airways to seek bankruptcy rehabilitation

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FILE – In this May 11, 2018, file photo, a Thai Airways jet parks at Suvarnabhumi Airport in Bangkok, Thailand. Thailand’s government spokeswoman says Prime Minister Prayuth Chan-ocha has endorsed a plan for flag carrier Thai Airways International to file a rehabilitation plan with the country’s Central Bankruptcy Court. (AP Photo/Sakchai Lalit, File)

BANGKOK (AP) — Thailand’s flag carrier Thai Airways International will file a plan for restructuring its business with the Central Bankruptcy Court, a government spokeswoman said Monday.

Narumon Pinyosinwat said the plan submitted by the State Enterprise Policy Office to salvage the airline will be submitted Tuesday to for Cabinet approval. She said she had no details of the plan.

Thai Airways had been suffering financially even before the coronavirus crisis brought travel and tourism in the country to a near standstill.

The airline initially sought a 54 billion baht ($1.7 billion) bailout loan from the government. There is speculation that its reorganization under bankruptcy could take the government’s ownership share below 50%, effecting a form of privatization. All rescue options were likely to lead in cuts in staff, fleet and flights.

Thai Airways logged losses of 12 billion baht ($374.3 million) in 2019, 11.6 billion baht ($361.9 million) in 2018 and 2.11 billion baht ($65.8 million) in 2017.

Thai media reports say it is carrying a debt burden of almost 300 billion baht ($9.4 billion).

The airline stopped all its flights at the beginning of April as Thailand imposed strict precautions to curb the spread of the coronavirus. Almost all its staff were put on leave at greatly reduced salaries. The government last week extended to the end of June a ban on arrivals on international passenger flights, ruling out their immediate resumption.

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