June 17, 2019 / 3:32 PM / a month ago

UPDATE 1-Brazil court allows carrier Avianca Brasil to hold bankruptcy auction

(Updates with context, adds no comment from carrier)

SAO PAULO, June 17 (Reuters) - A Brazilian appeals court ruled on Monday that airline Avianca Brasil should be allowed to hold a bankruptcy auction in which it is expected to sell its most coveted airport landing and departure rights.

The bankruptcy auction had been originally scheduled for early May, but was suspended at the last minute after an injunction was issued. Avianca Brasil filed for bankruptcy protection in December after falling behind on lease payments for its fleet and fell victim to high oil prices and a weak local currency.

A spokesman for the airline had no immediate comment and it was not immediately known when a new auction would be scheduled.

Avianca Brasil has been reducing its operations and lost nearly all of its Airbus planes by April. Brazil’s civil aviation regulator ANAC suspended all remaining activity in late May. The airline has not flown since.

Avianca Brasil’s largest creditor is U.S. hedge fund Elliott Management, with claims of around $500 million.

The carrier is controlled by the Efromovich family, whose aviation businesses have been battered recently. German Efromovich was ousted as chairman of Colombia-based Avianca Holdings SA in a boardroom shakeup led by United Airlines, which has lent millions to Efromovich’s companies.

An Argentine affiliate, Avianca Argentina, also suspended all of its flights this month.

Brazil’s two largest carriers, Latam Airlines Group and Gol Linhas Aereas Inteligentes SA, are expected to bid on Avianca Brasil’s assets.

Avianca Brasil is separate from the better known Avianca Holdings SA, which is based in Colombia, although both airlines share a corporate parent. (Reporting by Marcelo Rochabrun; Editing by Jeffrey Benkoe)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below