Thai govt OKs plan for bankruptcy court-led restructuring of Thai Airways

[webfact]

Thai govt OKs plan for bankruptcy court-led restructuring of Thai Airways

 

FILE PHOTO: Thai Airways airplanes park at the tarmac of the Suvarnabhumi airport in Bangkok, as Thailand will temporarily ban all passenger flights from landing in the country to curb the outbreak of the coronavirus disease (COVID-19), Thailand, April 4, 2020. REUTERS/Athit Perawongmetha

 

BANGKOK (Reuters) - Thailand's cabinet approved a plan to restructure troubled Thai Airways International Pcl's <THAI.BK> finances through a bankruptcy court, the Southeast Asian country's prime minister said on Tuesday.

 

The plan for a court-led restructuring of the national carrier replaces a previous proposal of a government-funded rescue package that was heavily criticised in the country.

 

The state-controlled airline's troubles are the latest example of how the coronavirus pandemic is crippling the global airline industry.

 

Colombia's Avianca Holdings SA <AVT_p.CN> and Virgin Australia Holdings Ltd <VAH.AX> have filed for bankruptcy protection since the pandemic broke out.

 

Airlines around the world have grounded the bulk of their capacity due to government directives and border restrictions.

 

Thai Airways, though, had been in trouble even before the outbreak of the coronavirus due to stiff competition from budget airlines and bloated costs.

 

It posted losses every year after 2012, except in 2016. In 2019, it reported losses of 12.04 billion baht ($377.3 million).

 

"The government has reviewed all dimensions ... we have decided to petition for restructuring and not let Thai Airways go bankrupt. The airline will continue to operate," Prime Minister Prayuth Chan-ocha told reporters at a news briefing.

 

"Thai Airways will be protected by the courts .... and a professional will be appointed to oversee the restructuring," Prayuth said, adding the airline’s workers will continue to have jobs.

 

Thai Airways said the plan will be implemented through the Central Bankruptcy Court and it would operate as usual as the restructuring took place.

“Thai Airways will not be dissolved or go into liquidation or be declared bankrupt,” Thai Airways Acting President Chakkrit Parapuntakul said in a statement.

 

Operations including passenger and cargo transportation will continue in parallel with the plan, he said.

 

Thai Airways shares surged 11.7% on Tuesday, but are still down by about a third this year.

 

(Reporting by Chayut Setboonsarng and Panarat Thepgumpanat; Editing by Kim Coghill and Muralikumar Anantharaman)

 

-- © Copyright Reuters 2020-05-19

 

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[colinneil]

27 minutes ago, webfact said:

The state-controlled airline's troubles are the latest example of how the coronavirus pandemic is crippling the global airline industry.

Thai airways were in dire straights long before the virus situation.

For many years they have been bleeding money, over staffed, over rated, too many spongers getting freebies.

They have been totally unable to run it as a profitable airline, totally unable/ unwilling to hire professional people, we are Thai, we know better than anyone.

[JoePai]

and a professional will be appointed to oversee the restructuring

 

aka Somchai the noodle seller

[welshguy]

Hmmmmmmmmmn,

 

Im booked with them, to go from heathrow in September...come back December..originally, I never thought I would go with this covid virus anyway....looks like now I will lose my money as well...............thank god I didnt book business class then!

 

Ive been using them for years, prefer them over Eva, as I prefer Thais flight times better.

 

They have been (Thai that is) getting steadily worse over the years, (eg. "tightening" up their "mileage miles, service getting worse etc....not seen them hand out any of those little orchid thingies to female passengers for years now) etc.etc...........That said, I mush prefer flying non stop, and I prefer the A380  to Evas 777 (I fly the middday flight form London...so that uses the A380 i Know they use the 777 for the evening flights from London, and in the off season they use 777s more...........

 

"Hopefully" if and when Thai airways come back....they will be better............. Very very much doubt it though, unless they make radical changes all through their system...whch  again is mega doubtful!

Edited May 19, 2020 by welshguy
spelling!

[trainman34014]

As I said yesterday; this is a case of 'Carry on Calamity', nothing will change apart from the losses that will become ever greater as the years pass.  They just can't handle the fact that they would have to fire off possibly more than 50% of all the hanger's on staff who are 'Connected' or 'Family' after telling them they had jobs for life and downsize the fleet by more than 50%.   The loss of face is just too much to bear, so the Thai Taxpayer has to foot the ever increasing bill to support this dead duck !

 

Shame on Prayut and his bunch of Gangsters for not having the balls to put the sick patient to sleep once and for all.

[GinBoy2]

I fear this is simply window dressing for what will be ultimately the usual government bailout, under the guise of bankruptcy.

 

Usually for airlines when or if, they exit from restructuring they are totally different entities

 

Hopefully I'm wrong, but I'm strongly of the opinion this is going to be a typical Thai, rearranging the deckchairs on the Titanic 

[crobe]

1 hour ago, welshguy said:

Hmmmmmmmmmn,

 

Im booked with them, to go from heathrow in September...come back December..originally, I never thought I would go with this covid virus anyway....looks like now I will lose my money as well...............thank god I didnt book business class then!

 

Ive been using them for years, prefer them over Eva, as I prefer Thais flight times better.

 

They have been (Thai that is) getting steadily worse over the years, (eg. "tightening" up their "mileage miles, service getting worse etc....not seen them hand out any of those little orchid thingies to female passengers for years now) etc.etc...........That said, I mush prefer flying non stop, and I prefer the A380  to Evas 777 (I fly the middday flight form London...so that uses the A380 i Know they use the 777 for the evening flights from London, and in the off season they use 777s more...........

 

"Hopefully" if and when Thai airways come back....they will be better............. Very very much doubt it though, unless they make radical changes all through their system...whch  again is mega doubtful!

I doubt that the Thai A380s will ever fly again.

With the collapse of the maintenance venture with Airbus and other airlines, such as Emirates, mothballing these, I don't think they will be economic under the "new normal" circumstances

[ChrisY1]

a

 

Edited May 20, 2020 by ChrisY1

[pineapple01]

Never liked Bankruptcy Laws. The Banks get cash priority. yet they are the first to know its a Bum Company and should have pulled the Plug. The little man takes the big fall.

[jaiyen]

Its the only airline where the air hostesse have to have a degree and pay to get a job, which they do for the perks for them and the family. Can't wait to hear who the "Professional" will be !  Definitely not a skilled aviation specialist

[JonnyF]

So they've simply repackaged the bailout due to the public backlash. What a surprise. They couldn't really let it go bust after so many people bought positions for life. A real cesspit of a company, I haven't used them for years and never will again.

[Pib]

Gosh, a the Thai Airlines "money pit" got so wide and deep that even the politicians couldn't stomach throwing more money in it (kinda).  

[herfiehandbag]

19 hours ago, webfact said:

Thai Airways said the plan will be implemented through the Central Bankruptcy Court and it would operate as usual as the restructuring took place.

“Thai Airways will not be dissolved or go into liquidation or be declared bankrupt,” Thai Airways Acting President Chakkrit Parapuntakul said in a statement.

So, they're not bankrupt then? So presumably they will be paying their creditors? I wonder at which International destination the first writ will be attached to an arriving TG aircraft?

[Pib]

There an article in today's (20 May) Bangkok Post regarding the Thai rehab....it's titled "Cabinet Gives Nod to Thai Rehab."  It has an excellent slide showing the steps.   

 

And if a person wants more info on Thailand's bankruptcy procedures below website has a good overview.

https://juslaws.com/bankruptcy-procedures-in-thailand.php

Edited May 20, 2020 by Pib

[hotchilli]

18 hours ago, JoePai said:

and a professional will be appointed to oversee the restructuring

 

aka Somchai the noodle seller

Possibly the noodle seller knows how to turn a profit!

[Oziex1]

Court led, Huh.

So the politicians hand ball the hot potato to the Judiciary.

 

Well played the usual take no responsibility, pass the buck to others.

[bodga]

20 hours ago, webfact said:

and a professional will be appointed to oversee the restructuring,"

I  think they've  all returned to  Issan for the foreseeable  future?

[bodga]

3 hours ago, jaiyen said:

Its the only airline where the air hostesse have to have a degree and pay to get a job, which they do for the perks for them and the family. Can't wait to hear who the "Professional" will be !  Definitely not a skilled aviation specialist

Air Chief Marshal................insert name  of  choice.

[BobbyL]

The state-controlled airline's troubles are the latest example of how the coronavirus pandemic is crippling the global airline industry.

 

Fake news. They haven't turned a profit in years and were losing around 1 billion / month long before anyone even knew the word Coronavirus. 

[DirtyHarry55]

Part of the pm's tweet on it no one knows why he wrote the TWITTER at the top
some think maybe instructions from Mercury LCC
 

ประยุทธ์ จันทร์โอชา Prayut Chan-o-cha

@prayutofficial

 

TWITTER
 

Today, I made a difficult decision regarding

@ThaiAirways. But it’s one that I know is in the best

interests of every member of the public and of our country.
 

I had three choices: find more money for Thai Airways; or, let it go bankrupt;

or, refuse to finance Thai Airways, but put it into court-supervised

rehabilitation. I decided on the third option...

[digbeth]

22 hours ago, JoePai said:

and a professional will be appointed to oversee the restructuring

 

aka Somchai the noodle seller

Any Somchai who actually sold noodles is more capable of doing any job than the useless retired generals they stuffed Thai management with

[teacherofwoe]

On 5/19/2020 at 2:35 PM, webfact said:

It posted losses every year after 2012, except in 2016. In 2019, it reported losses of 12.04 billion baht ($377.3 million).

 

"The government has reviewed all dimensions ... we have decided to petition for restructuring and not let Thai Airways go bankrupt. The airline will continue to operate," Prime Minister Prayuth Chan-ocha told reporters at a news briefing.

 

"Thai Airways will be protected by the courts .... and a professional will be appointed to oversee the restructuring," Prayuth said, adding the airline’s workers will continue to have jobs.

It's difficult to find the words. An eight year basket case is going to be bailed out. Maybe I'm just stupid.

 

[whiteman]

After the share sale by the ministry, all but three airline board members will resign. Those left behind will join three new board members, expected to be Tevin Wongwanich, president and chief executive of PTT Exploration and Production Plc; GSB president Chartchai Payuhanaveechai; and Charamporn Jotikasthira, a former THAI president.

 

Not one on the board has any air line experience  Amazing Thailand

[Rhys]

...hmmm that dude from the health ministry has not been in the news lately...put him in charge...

[scorecard]

16 hours ago, teacherofwoe said:

It's difficult to find the words. An eight year basket case is going to be bailed out. Maybe I'm just stupid.

 

More like 'several decades' basket case.

 

Sure in the commercial world the patient would have been subjected to severe medicine 20+ years ago.

 

But it's a state enterprise and cannot be subject to loss of face. Reality.

[Oziex1]

6 hours ago, Rhys said:

...hmmm that dude from the health ministry has not been in the news lately...put him in charge...

Perfect, a 500% increase in ticket price for the dirty farang.