December 3, 2022
An Asian airline turns to the US to save itself

An Asian airline turns to the US to save itself

Asian airline Garuda Indonesia turns to US Chapter 15 for bailout

Garuda Indonesia has filed for bankruptcy in the US using ‘Chapter 15’, which allows a foreign creditor to sue in a US court as long as it owns assets in more than one country.

Chief Executive Officer Irfan Setiaputra told Reuters. Recently, the airline reduced its debt with its creditors from US$9.8 billion (R$51.5 billion) to US$5 billion (R$26.3 billion), but the agreement has been challenged by the aircraft leasing company in the country’s Supreme Court.

Dutch company Greele Goose Leasing is not participating in the restructuring plan, but Boeing, which owes more than US$820 million from the airline, may participate in the process, the Indonesian government said.

Garuda Indonesia turned 75 in August and has about 80 aircraft in its fleet, operating to about 50 destinations. It plunged into crisis at the start of the Covid-19 pandemic, laying off 30% of its staff and slashing the salaries of executives and flight attendants.

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