The Colombian airline Avianca (AVHOQ) (AVH) announced that it has secured commitments for debtor-in-possession financing for over $2 billion. The airline desperately tries to save a financing package that is a key to the existing bankruptcy protection.
On September 22, 2020, Anko van der Werff, the CEO of Avianca (AVHOQ) (AVH), revealed that the airline has also filed a motion to approve the $2 billion financing package in the U.S. Bankruptcy Court. The CEO said that the airline already received support from the third-party institutional investors as well as already existing lenders.
Werff shared a concern that securing financing commitments was a crucial step in the airline’s reorganization process. The air carrier looks forward to the U.S Court approval of the proposed debtor-in-possession financing package.
Earlier in September 2020, Avianca (AVHOQ) (AVH) filed an appeal on Colombian court’s decision to suspend the payout of a $370 million loan, a part of a $2 billion financing package, that had been already approved.
The Colombian court blocked the government’s loan, worth $370 million, due to allegedly disclosed controversial deal details of kinship ties between President of Colombia Ivan Duque Marquez and a Senior Executive at Avianca (AVHOQ) (AVH).
The struggling Avianca (AVHOQ) (AVH) filed for bankruptcy under Chapter 11 protection in May 2020. The airline identified an unpredictable impact of the COVID-19 pandemic as the main cause of its collapse.