LATAM Airlines Group has officially exited bankruptcy protection following the successful completion of its financial restructuring to emerge as a more efficient group with a modernised fleet, a strengthened financial position of more than USD2.2 billion of liquidity and USD3.6 billion or 35% less debt.
The group voluntarily filed for US Chapter 11 in May 2020 to reduce its debt, access new sources of financing, and transform its business in response to the global pandemic. The restructuring saw the injection of about USD8 billion into the airline through a combination of a capital increase, the issue of convertible bonds, and new debt. This includes a USD500 million revolving credit facility and a five-year term loan facility of USD1.1 billion. The plan was implemented with the support of new prominent shareholders, including Sixth Street, Strategic Value Partners, and Sculptor Capital Management, and incumbent strategic shareholders Delta Air Lines, Qatar Airways, and the Cueto family.
An extraordinary shareholders' meeting will be held on November 15, 2022, to renew the board of LATAM Airlines Group.
"We are pleased that we have completed a significant transformation and emerged from our financial restructuring process with a strengthened financial position and a renewed commitment to operational excellence. As a group with a dynamic team of 30,000 employees and an unrivalled connectivity network, we look forward to continuing to offer passengers the best alternative for travel to, from, and within South America and to contribute in the broader sense to the various countries in which we operate and their diverse interests,” Group Chief Executive Officer Roberto Alvo said in a statement.
LATAM affiliates operate in five domestic markets in the region: Brazil, Chile, Colombia, Ecuador, and Peru, as well as internationally within Latin America and to Europe, the US, the Caribbean, and Oceania. Africa will be added soon as LATAM Airlines Brasil resumes the São Paulo Guarulhos-Johannesburg O.R. Tambo route in mid-2023. The group reached 144 destinations in 22 countries as of October 2022 and expects to close the year with a global operation footprint (measured in Available Seat Kilometers - ASKs) of more than 85% compared to 2019. Between 2021 and 2022, the group added 10 new destinations in Brazil and plans to operate 36 new routes by 2023.
Regarding the fleet, LATAM entered into agreements with Airbus to acquire by 2029 a total of eighty-seven A320neo Family aircraft. According to the ch-aviation ch-aviation fleets module, the group's current mixed fleet of both Airbus and Boeing aircraft numbers 288 aircraft including B767s, B777s, B787s, A321s, A320s, A320neo, and A319s.
LATAM Cargo and the cargo subsidiaries are in the midst of an expansion plan that will allow them to increase their respective fleets from eleven B767-300Fs in 2019 to up to twenty B767-300Fs in 2024.
Recently, LATAM Group implemented a joint venture with Delta that covers more than 300 destinations between North America and South America (Brazil, Chile, Colombia, Paraguay, Peru, and Uruguay).