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Colombian airline Viva Air enters the business recovery process

Colombian airline Viva Air enters the business recovery process

The low-cost Colombian airline Viva Air began a Business Recovery Process (PRE) to renegotiate debts with its creditors and achieve its permanence in the market, while awaiting a definition from the Civil Aeronautics on its alliance with Aviancathe company reported.

Viva Air said in a statement on Friday night that it made the decision to start the process due to the crisis it is facing due to the effects of the COVID-19 pandemic and economic difficulties.

“The company has not been able to have access to capital during the last nine months since it has not yet been possible to implement its integration with another airline, which is still pending authorization from the National Government,” assured the airline.

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“Viva accepts this voluntary recovery process that lasts 90 days, in order to restructure its debts through a negotiation with its main creditors to continue operating under sustainable conditions that guarantee the continuity of the company”he added.

The airline said that after studying all the available alternatives in the face of the current situation, it entered this voluntary mediation process while awaiting the urgent decision by the Aeronautics of its alliance with Avianca.

The announcement came after ultra-low-cost airline JetSMART Airlines announced its intention to buy 100% of Viva Air.

The Civil Aeronautics of Colombia objected in November to a business integration process of Avianca and Viva, considering that it represented risks for competition in the sector and the well-being of consumers.

The airlines filed an appeal and in January the aviation governing body annulled the integration process due to procedural irregularities and restarted it.

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Viva is going through a complex financial situation due to the impact of the COVID-19 pandemic, aggravated by the rise in the price of fuel during 2022 and the devaluation of the Colombian peso.

Viva, which emerged as a low-cost airline with operations in Colombia and Peru, has a fleet of 23 aircraft and some 1,000 direct employees.

Source: Reuters

Source: Gestion

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