The US government has asked the New York court not to put Latam’s judicial reorganization plan, presented by the airline at the end of November, to a vote. The document was sent on the 7th by the United States Trustee, an agency of the US Department of Justice responsible for overseeing the judicial reorganization processes in that country.
According to the agency, Latam’s plan did not provide sufficient information to creditors and shareholders. The United States Trustee also pointed out that the airline has omitted necessary data especially in relation to small creditors. If the New York court agrees with this position, Latam’s creditors will only be able to vote on the recovery plan after changes to the text.
The largest airline in Latin America, Latam has been in judicial recovery since 2020. In August 2021, the company’s commitment to short-term debt grew 65% in one year and reached US$ 10.9 billion.
When contacted, Latam did not comment.
(Update at 4:10 pm on January 26, 2022: In a note, Latam stated: “Latam clarifies that this is not a request to stop the restructuring plan, but an objection presented to the court. It is normal in these cases for parties have objections, and this objection is quite common in Chapter 11 proceedings,” he stated, referring to the American bankruptcy law.)