While the biggest airline bankruptcy announcement of 2024 has been that of the embattled Spirit Airlines (SAVE) several other airlines have run into similar problems and suffered similar fates.
In January 2024, the Brazilian low-cost airline GOL Linhas Aéreas (GOAL) announced that it filed for Chapter 11 protection in the U.S. It had accumulated more than $3.8 billion in liabilities awaiting Boeing's delay. (bachelor of arts) planes and was struggling with operations under a growing debt load.
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Airline proposes an exit plan from bankruptcy and promises an “important milestone”
GOL announced on December 10 that it submitted a reorganization plan that promises to convert $1.7 billion of debt into equity and raise $1.85 billion of new financing through new investors. This includes the transfer of approximately $950 million in new capital, with the possibility of a larger amount in the future, to its parent holding company Abra in exchange for erasing $2.8 billion in debt.
“With the resolution of these issues, debtors will be well positioned to begin raising the necessary exit capital required by their business plan and engage with their other creditor groups,” he said.
“The presentation of the Plan represents an important milestone towards the successful completion of GOL's financial and operational restructuring and implements a significant investment of new capital to support GOL's business,” the airline said in a statement.
As the debtor works to obtain confirmation of its Chapter 11 plan from a New York bankruptcy judge, GOL also recently requested an extension of the deadline to continue negotiations with creditors who financed the lease of 139 aircraft and 58 engines while refining their long-term business plan.
Related: Spirit CEO says airline won't file for bankruptcy
'Efforts to strengthen our financial position and drive GOL's long-term success'
“Reaching this agreement is another important step in our efforts to strengthen our financial position and drive GOL's long-term success,” GOL CEO Celso Ferrer said in a statement.
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GOL, which began operating in 2001 from Rio de Janeiro, has grown rapidly to be among the largest airlines in South America; in 2024, it was only behind Chilean LATAM. (LTMAQ) and the Colombian group Avianca (AVHOQ) by the total number of passengers transported.
But despite high ticket sales, GOL has run into financial problems that initially began to accumulate amid the drop in the number of travelers during the Covid-19 pandemic and, subsequently, its inability to restart its operations in the face of the delay in Boeing deliveries. The latter has been a challenge for the entire industry that also airlines affected like the United States (UAL) but the latter was able to solve it with a larger base fleet.
Along with Spirit, other airlines that have had to declare bankruptcy or completely cease operations in recent months include Estonian low-cost airline Nordic Aviation Group (better known by the brand Nordica) and north of the border. Canada Jetlines airline.
After racking up more than 11.8 million Canadian dollars (approximately $8.7 million) in debt and struggling to find an investor to bail it out, the budget airline initially launched to transport Canadian tourists to warm destinations like Florida and Jamaica began to cancel flights. Three of the airline's executives and CEO Brigitte Goersch retired before the final bankruptcy announcement was made.
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