Avianca Holdings has announced that its board of directors approved the filing of its restructuring plan at the Bankruptcy Court for the Southern District of New York in the United States on August 10.

The plan, which has not yet been made public, is the result of negotiations that have been carried out with investors and other related parties and “outlines Avianca’s proposal to satisfy pre-bankruptcy obligations to creditors,” the company said in a stock exchange disclosure.

The Panamanian holding’s plan of reorganisation includes details such as the shape of its future fleet, workforce, business model, routes and frequencies, and cost and income projections. The avianca airlines (AV, Bogotá) parent described its filing at the court as “an important milestone as we continue toward the successful completion of our financial and operational restructuring,” eventually “establishing Avianca as the most robust airline in Latin America.”

The next step in the Chapter 11 process will be a hearing for the bankruptcy court to consider the approval of a disclosure statement, scheduled for September 14. This document should contain enough data on the assets, liabilities, and business affairs of the debtor to enable creditors to make an informed judgement about the restructuring plan.

Avianca, whose central idea is to become nimble enough to tackle the robust low-cost competition in Central and South America, aims to exit the Chapter 11 process before the end of this year.

Towards the end of July, the court approved the terms of, and Avianca’s entry into and performance under, DIP-to-exit facility commitment letters lodged earlier that month. According to those letters, the group has secured a USD1.6 billion financing package from both existing and new lenders aimed at enabling it to exit Chapter 11.

In tandem with the announcement, Avianca unveiled plans to launch 23 new international routes from Colombia, Ecuador, Costa Rica, Guatemala, and El Salvador.

The airline said that from Colombia, it will open 13 new direct routes including from Cali to New York JFK, Cancún, México City International, San José Juan Santamaría, and Quito International; from Medellín José Maria Córdova to Aruba, Mexico City, Orlando International, San Jose, Quito, and Guayaquil; from Bucaramanga to Miami International, and from Bogotá to Toronto Pearson, Canada. From Ecuador, Avianca will also open direct flights from Quito to each of New York, Miami, Cali, and Medellin; as well as from Guayaquil to New York, Miami, and Medellin. In Costa Rica, it will offer direct flights from San Jose to Managua, Los Angeles International, New York, Mexico City, Cali, and Medellin while from El Salvador, it will start flights from San Salvador International to Orlando.