Avianca files for bankruptcy

Avianca, one of Latin America’s largest airlines, has filed
for Chapter 11 bankruptcy reorganization. 

The Colombia-based carrier also said it would wind down
operations in Peru.

Avianca’s fleet has been grounded since March 25, due in
large part to the closure of borders in its operating bases in Central America
and South America.

The carrier, a member of the Star Alliance, served 76
destinations in 27 countries prior to the Covid-19 crisis. Avianca has more
than 21,000 active and furloughed employees. 

During the bankruptcy process, customers will still be able
to use tickets, vouchers and gift cards as usual. Bookings, mileage accruals
and mileage redemptions will continue. Avianca also said it expects to continue
to issue refunds. 

Avianca entered the Covid-19 crisis on weaker footing than
many global carriers. Last year it initiated its “Avianca 2021” restructuring
plan, which included a network redesign, the launch of a new pricing model,
reprofiling of debt and lease obligations and the raising of $375 million in new

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