BANGKOK: Thailand’s cabinet today approved a plan for Thai Airways International to restructure under the bankruptcy law.
The plan will be implemented through the Central Bankruptcy Court, replacing a proposal for a government-guaranteed loan to rescue Thai Airways, which is 51%-owned by the government through the Ministry of Finance.
Prime Minister General Prayuth Chan o-cha said it was a difficult decision but it is best in the public and national interest.
“The government has reviewed all three options in detail…We agreed to the court-supervised restructuring as it will not lead to the airline going bankrupt…the airline will continue to operate.
“We hope Thai Airways will be our national airline that makes all of us proud again,” he said after chairing the weekly cabinet meeting here today.
In a statement, second vice chairman and acting president of Thai Airways, Chakkrit Parapuntakul, said the airline will operate flights and run its business as usual, he said.
“Although Thai Airways’ reform plan will be implemented and exercised through the business reorganisation chapter under the bankruptcy law, it will not be dissolved or go into liquidation or be declared bankrupt.
“The business reorganisation chapter will enable Thai Airways to reach its reform plan’s objectives even more effectively step by step as required by the law which provides equitable protection to all relevant stakeholders.
“Thai Airways will be able to conduct its normal business operations including passenger and cargo transportation.
“The business will be conducted in parallel with the reform plan to increase operational efficiency and improve product and service quality,” he said.
Thai Airways had been in trouble even before the Covid-19 outbreak due to stiff competition from budget airlines, the global economic slowdown and bloated costs.
Thai Airways reported a net loss of 12.04 bil baht (RM1.64 bil) in 2019. The airline has recorded losses every year since 2012 except 2016. Its total debt stands at about 250 bil baht. – May 19, 2020, Bernama