A New York district court overseeing the bankruptcy of LATAM Airlines Group (NYSE: LTM) approved a financing proposal to allow the Chilean carrier to access $2.45 billion for countering the impact of the coronavirus pandemic.
Judge James Garrity Jr. of the U.S. District Court for the Southern District of New York approved LATAM’s modified debtor-in-possession (DIP) financing proposal Friday.
LATAM CEO Roberto Alvo called the DIP’s approval “a very important step for the sustainability of the group.”
LATAM filed for bankruptcy protection in the U.S. in May to downsize the airline and restructure its debt, citing the financial toll of the coronavirus pandemic on its international passengers.
Qatar Airways and LATAM Chairman Ignacio Cueto, two of the Santiago-based company’s largest shareholders, are providing $900 million in DIP financing.
LATAM has continued to operate passenger and cargo services during the bankruptcy process. Passenger operations are limited during the travel downturn induced by the coronavirus.
In mid-August, LATAM Cargo started a weekly flight between Miami and the Florianopolis airport in southern Brazil. The Boeing 767 freighter transports automotive parts, metals, food, pharmaceuticals and electronics to consumers in the Santa Catarina province.