(Updated with cash infusion details from Bloomberg report)
Thai Airways is seeking a capital infusion of as much as 50 billion baht (US$1.65 billion) under a debt restructuring plan set to be submitted to a bankruptcy court to keep the flag carrier operational, according to a Bloomberg report, citing people familiar with the matter. The fund may be raised through equity, loans or convertible securities, said the people, who asked to not be identified before the debt plan is submitted to the court in Bangkok on Tuesday. The capital infusion plan will need to be backed by the airline’s hundreds of credit-holders and approved by the court, they said. A spokesman for Thai Airways declined to comment on the specifics of the debt rehabilitation plan but said the carrier’s Acting President Chansin Treenuchagron will hold a briefing at 2 p.m. local time on Tuesday.
Earlier, Thai Airways reported a record loss last year after the COVID-19 pandemic shut down international aviation. The net loss widened to 141.2 billion baht (US$4.6 billion) from 12 billion baht in 2019, Thai Airways said in an exchange filing on 24 February. The annual loss was the largest ever for a Thai company, according to data compiled by the Stock Exchange of Thailand.
Revenue fell 73.8 per cent to 48.3 billion baht. Thai Airways, which has posted losses every year barring one since 2013, is preparing to submit a debt rehabilitation plan to the bankruptcy court in Bangkok by 2 March in a bid to reduce its liabilities from 336.7 billion baht and return to profit, according to media reports from Bloomberg and Reuters. The airline has sold stakes in some units, cut staff and opened its flight simulators to the public to generate additional revenue and cushion the blow from an unprecedented hit to global tourism and travel industry.
While the airline expects its performance in the first half to improve from a year ago with easing of some travel curbs, it will still be “negative,” it said in the statement. “Vaccines will be a significant factor in the aviation industry because it affects entry restriction policy of Thailand and other countries around the world and would increase the travelling confident of tourists,” Thai Airways said. “However, air travel around the world is expected to return to normal in 2024.”
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