BANGKOK, Sept 14 (Reuters) - Thai Airways International
Pcl's request to restructure its debt as part of
bankruptcy proceedings was approved by a bankruptcy court on
Monday, sending its share price sharply higher.
The decision by the court, which handles bankruptcy and
restructuring requests in Thailand, allows the airline to move
ahead with drawing up plans to restructure 245 billion baht
($7.83 billion) worth of debt.
It comes as the coronavirus fallout has added to the woes of
the airline, which has been struggling since 2012 and in which
the government has a large stake.
Thai Airways shares rallied more than 7% after the news,
bucking a fall in the wider stock market.
"The court has ordered the restructuring," Judge Kampol
"If the debtor is not restructured, it could cause damage to
the company, creditors, employees, investors, the public and
impact the national economy," he said.
The court also approved a seven-member committee to draw up
the restructuring plan. It includes veteran banker Boontuck
Wungcharoen, Piyasvasti Amranand, the airline's former president
and EY Corporate Advisory Services Co Ltd.
After three hearings and negotiations with the airline, some
creditors withdrew their opposition to the restructuring.
"More than half of creditors supported restructuring," the
airline's acting president, Chansin Treenuchagron, told
reporters on Monday.
"We will be in negotiations with creditors this quarter and
a plan will be ready by the first quarter of next year."
The airline previously said a second committee would be set
up to execute the restructuring plan - a process that could take
up to seven years - once it was agreed by creditors and the
Thai Airways was in difficulty well before the coronavirus
grounded flights across the globe, booking losses nearly every
year after 2012. It reported losses of 28.03 billion baht in the
first half of this year.
The same court in May accepted the airline's request for
bankruptcy protection, allowing debt payments to be suspended.
Later that month, the government cut its stake in the carrier to
47.86%, ending its status as a state-enterprise.
Other Thai airlines have asked for $770 million in state
($1 = 31.2800 baht)
(Reporting by Chayut Setboonsarng
Writing by Orathai Sriring
Editing by Ed Davies and Ana Nicolaci da Costa)