Latam Airlines Group SA’s official low-ranking creditor group is unhappy with the Chilean carrier’s bankruptcy exit proposal, arguing a sale to rival Azul SA could leave its members much better off. In court papers filed Wednesday, Santiago-based Latam’s unsecured creditor committee said the airline’s current reorganization plan is so unfair that it can’t win court approval. It flouts US bankruptcy rules by favoring some evenly-ranked creditors over others and giving value to shareholders that don’t deserve it, lawyers for the group wrote. “Rather than use the past eighteen months to negotiate and prepare a value-maximizing plan that treats all constituents fairly and in accordance with the Bankruptcy Code, the Debtors have used their exclusive opportunity to negotiate an unconfirmable insider deal at the expense of non-preferred creditors,” lawyers from the Dechert firm wrote on behalf of unsecured creditors. Under the current proposal, Latam locked arms with key shareholders -- Delta Air Lines Inc., Qatar Airways and Chile’s Cueto family -- and a major creditor group on a deal that would raise about $5b and slash its debt load. Sixth Street Partners, Sculptor Capital and SVPGlobal are leading the creditor group that has agreed to backstop the plan. The plan would result in creditors taking control of the company, while existing shareholders could retain a sizable ownership stake. That’s unusual in US bankruptcy -- stockholders are last in line to be repaid -- but Latam’s deal would smooth over potentially thorny Chilean securities law issues. <br/>
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Iberia-owner IAG and Air Europa are looking at alternative ways to work together, with a deadline set for the end of January, after they cancelled a takeover deal more than a year after it was struck. IAG, which also owns British Airways, said on Thursday it would pay E75m to Air Europa’s privately held Spanish owner Globalia. “IAG has also reached an understanding with Globalia to evaluate, before the end of January 2022, alternative structures that may be of interest to both companies and offer significant benefits for their shareholders, customers and employees,” the company said. IAG had announced plans to buy Air Europa from Globalia for E1b in 2019, but the price was cut in half this year after the airline industry was sent into a tailspin by the COVID-19 pandemic. The British airline group this week said it was set to cancel its takeover of Air Europa after European regulators indicated they would not allow it to go through without further concessions. IAG said it would pay E35m, on top of the E40m break-up fee, after agreeing that the amount would be used to reduce any future purchase price if a new deal is reached and to avoid litigation.<br/>
British Airways is aiming to extend its joint business arrangement with IAG shareholder and Oneworld alliance partner Qatar Airways, to provide greater access to one another’s networks. BA has newly re-opened its Doha connection, with a Boeing 777-200ER service from London Gatwick, and the two carriers will jointly operate up to six daily flights between the cities over the winter – including a connection to Gatwick. The expanded co-operation will provide “enhanced access” from Europe to such destinations as Singapore, Sydney, Colombo and Nairobi as well as European cities including Amsterdam, Madrid and Dublin. BA says the carriers expect to receive regulatory approval notifications in the first half of next year. “Proposed expansion of the joint business will be great news for customers, offering them access to more destinations across the world with seamless connections,” says CE Sean Doyle. He says the co-operation will provide “more options” to passengers to fly to leisure destinations, the Maldives and Seychelles among them. Qatar Airways group chief Akbar Al Baker says the development is an “important milestone” towards providing customers with access to “the most extensive route network and unrivalled product”.<br/>