Source: LATAM
LATAM Airlines Group S.A. and its affiliates in Brazil, Chile, Colombia, Ecuador, Peru, and the United States made important progress today in its Chapter 11 proceeding in the United States, after the Court approved the adequacy of the Chapter 11 Disclosure Statement for LATAM. This resolution establishes that the documentation provided by LATAM in the process is sufficient to allow the group to commence solicitation of votes, during which it will seek approval of the Plan from creditors. The decision comes after LATAM first filed its Plan of Reorganization on November 26, 2021 (the “Plan”).
In this way, it is expected that in the coming weeks LATAM will begin the process of requesting votes regarding the Reorganization Plan (Solicitation Period), during which time it will seek its approval. This represents a fundamental step for LATAM’s exit from Chapter 11.
The Court has also set the Confirmation Hearing to take place on May 17 and 18, 2022, at which point the Court will evaluate the Plan of Reorganization, the last milestone of the bankruptcy process in the United States. LATAM continues to anticipate completion of the process and emergence from Chapter 11 in the second half of 2022.
This comes after the Court approved LATAM’s debtor-in-possession loan amendment between LATAM and its creditors on March 15, 2022, enabling LATAM to access $3.7 billion in liquidity and refinance its existing DIP loan agreement (Super-Priority Debtor-in-Possession Term Loan Agreement). Additionally, the new loan agreement extends the maturity date in accordance with the timing that LATAM is targeting for emergence from the Chapter 11 Proceeding.
Last week, the Court approved LATAM’s backstop agreement in support of the Plan and financing proposed by LATAM and some of its direct and indirect affiliates. These agreements represent approximately $5.4 Billion in committed funds.
The Plan, Disclosure Statement, and other relevant case materials can be accessed publicly at cases.primeclerk.com/LATAM.