BANGKOK, June 15 (Reuters) - Thai Airways International Pcl
won court approval on Tuesday to restructure a debt
load of $12.9 billion as the airline, which is already in
bankruptcy protection, seeks to turn around its fortunes.
The court ruling removes the last hurdle to implementation
of the plan, seen as critical for the carrier which last year
posted a record loss of about $4.5 billion.
In its order, the Central Bankruptcy Court in Bangkok said
it approved the rehabilitation plan. It did not make any changes
to the plan that had been approved by creditors.
A hearing was postponed after two complaints filed against
the plan by certain creditors.
"We are satisfied with the decision," Somboon Sangrungjang
of law firm Kudun and Partners, which represents 87 saving
cooperatives, told Reuters.
A committee of five, including the airline's acting chief
executive Chansin Treenuchagron and its former CEO, Piyasvasti
Amranand, will administer the plan, which covers the airline's
debt of 400 billion baht ($12.86 billion).
Piyasvasti helmed the airline the last time it was
profitable from 2009 to 2012.
The airline was in difficulty well before the coronavirus
pandemic grounded many flights across the globe, booking losses
nearly every year after 2012.
The restructuring plan for 170 billion baht worth of debt
relies heavily on debt extensions and debt-to-equity
conversions, and limits most of the haircuts to late interest
payments, Somboon said.
The airline was also reducing debt with airplane lessors.
Leasing agreements for 16 jets were being cancelled and the
debt was being negotiated, Chief Financial Officer Chai Eamsiri
told a news conference.
The airline was in talks with government and private
financial institutions to obtain 50 billion baht in new capital
to support its cash flow, he added.
In March, the carrier said it planned to cut its fleet size
to 86 jets by 2025 from 103 now. Thai Airways says it has cut 30
billion baht in expenses.
The Thai government holds a 47.86% stake in the carrier, but
it is not governed by the country's state-enterprise law.
Thai Airways this month resumed routes between European
cities and the resort island of Phuket in Thailand, anticipating
a government scheme to allow vaccinated tourists to skip a
It expects to carry about a thousand passengers in July.
Analysts blame internal inefficiencies for the carrier's
trouble with budget and long-haul rivals.
"Thai Airway's challenges are mainly institutional and
inefficiency. The airline should rely less on government support
to ward off external influence and professionalise management,"
said Ben Kiatkwankul of the Maverick Consulting Group business
"The Phuket tourism sandbox flights will be an initial
(Reporting by Chayut Setboonsarng; Editing by Ed Davies and