Thai Airways takes action to protect its planes from seizure

Struggling national flag carrier Thai Airways is petitioning 3 countries to protect its assets, including aircraft, from seizure by creditors. Government spokeswoman Narumon Pinyosinwat made the announcement yesterday. The cabinet was informed about the filing of debt rehabilitation requests in foreign countries by Deputy PM Wissanu Krea-ngam, who chairs the committee tasked with coordinating a solution to the airline’s problems.

The airline has petitioned courts in Switzerland, Germany and Japan, and submitted a similar request in the US, where its creditors are based. The petitions, if approved, will protect the company against its aircraft being impounded overseas.

The cabinet learned yesterday that the airline racked up 12 billion baht in debt last year alone, bringing up its total outstanding debt to 244 billion baht. It has fixed expenses of between 5-6 billion baht a month, and without a liquidity boost, will only have enough cash to survive until the end of June.

The rehabilitation plan is being drawn up by 5 members of its board, which includes former president Piyasvasti Amranand, under the supervision of Thailand’s bankruptcy court. Along with EY Corporate Advisory Services, they will have “the authority and duty in managing the business and assets of the company.”

In a related development, Thai Airways has announced it is relaunching international flights from August 1, with the following flights scheduled. At this stage the government and Civil Aviation Authority have made no official announcement about the re-opening of international borders of the resumption of flights. A ban on international flights remains in force until at least the end of June.