Avianca exiting bankruptcy with low-cost flexibility, CEO says

Avianca Group International is emerging from bankruptcy with plans to compete with low-cost carriers on price while keeping parts of the business that made it Latin America’s second-largest airline before the Covid-19 pandemic hit. CEO Adrian Neuhauser said the company was able to slash debt and build up liquidity during an 18-month Chapter 11 reorganization that it exited this week. It will add more seats on planes and use the point-to-point route structure made popular by low-cost airlines rather than relying on flying through its hubs. “We’re trying to take the best of what we were, a service-focused legacy carrier with a broad route network, and combine it with what we’ve seen our competition do which has been very effective: to offer more point-to-point and offer lower prices,” Neuhauser said in an interview. “We’re very focused on being disciplined and on cost.” Colombia’s largest airline is now owned by a group of creditors that extended it a financial lifeline during the bankruptcy process. The new owners include Kingsland Holdings, which is controlled by Salvadoran mogul Roberto Jose Kriete Avila, and billionaire Ken Griffin’s hedge fund Citadel. United is also a creditor in the group, but its debt has not been converted into equity yet, Neuhauser said. The restructured company, which is now domiciled in the UK but operates out of a Bogota headquarters, will be closely held until management decides where to list the stock, he said. The company is considering a single listing in either the UK or the US, but it has yet to decide. <br/>