Thai Airways International to Reorganize, Not be Dissolved, Liquidated or Declared Bankrupt
Thai Airways International announced on Tuesday that although the Thai Cabinet approved the carrier’s reform plan under the auspices of the Central Bankruptcy Court of Thailand and the Bankruptcy Act, the carrier will not be declared bankrupt.
Today, Thai Airways International (THAI) announced that the carrier will not be dissolved, liquidated or declared bankrupt. Over the past several days there have been numerous news accounts of the carrier’s bankruptcy, but in a March 19, 2020 press release THAI attempts to clarify the situation. According to the airline, while the Thai Cabinet approved the business reorganization plan under the auspices of the Central Bankruptcy Court of Thailand and the Bankruptcy Act, THAI will not be dissolved, liquidated or declared bankrupt.
The bankruptcy/administration process varies around the world, so it can be somewhat confusing. In the U.S. for example, a Chapter 11 Bankruptcy is a reorganization, where a company secures debtor-in-possession (DIP) financing so they can operate normally during the reorganization process. On the other hand, a Chapter 7 U.S. Bankruptcy involves the company ceasing to operate and liquidation of assets. Apparently, under Thai law, being “declared bankrupt” is essentially equivalent to liquidation. In today’s announcement, THAI makes it clear that they will continue to operate normally during reorganization. A copy of the May 19, 2020 THAI press release is reproduced below.
Source: Thai Airways International