“We have initiated a voluntary procedure to implement financial restructuring under the Chapter 11 process in the United States of America. The legal process will not disrupt the airline’s operations,” the carrier said in a statement.
The Chapter 11 is a form of bankruptcy in which the carrier can maintain operation while reorganizing its business affairs, debts and assets.
Citing economic impact from the COVID-19 pandemic, the airline’s Chief Executive Officer Andres Conesa explained that “our industry faces unprecedented challenges due to significant declines in demand for air transportation globally.”
The Mexican carrier is the latest Latin American airline to seek reorganization amid the pandemic. The region’s two other largest airlines — Santiago-based LATAM Airlines and Colombia’s Avianca — had filed for Chapter 11 reorganization in the United States in May.