Thai Air creditors delay vote on debt restructuring plan

Thai Airways International Pcl delayed a vote on its restructuring plan by a week after some creditors pushed for changes and sought time to study some last-minute tweaks unveiled by the administrator.

The creditors will now meet again on May 19 after 20 of them proposed postponing the vote, Thai Air said in a statement. At Wednesday’s meeting held by video conference, some debtholders sought more clarity about details of the restructuring plan which included some changes, the carrier said.

The carrier’s stock swung between gains and losses before closing 3.7% higher in Bangkok. The stock has tumbled 45% since the exchange lifted a trading suspension on April 16.

The national flag carrier needs more than 50% of creditors to accept its plan, which is part of measures to help it return to profitability as it navigates the devastation wreaked on the global travel industry by the pandemic. The airline, which has total liabilities of at least $11 billion, in March proposed a three-year freeze on loan repayments in one of the nation’s most high-profile restructurings.

Thai Air is seeking a deferment of bond repayments for six years and a waiver of unpaid interest on loans as part of the plan, involving about 170 billion baht ($5.44 billion) of debt. It’s also looking to raise 50 billion baht in new capital, plans to slash its workforce in half and sell property to help return to profitability.

The Southeast Asian country is facing renewed woes more than a year into the pandemic as a new wave of infections brings more turmoil to its crucial travel sector. Thai Air, which saw a record loss of 141 billion baht last year, joins other global peers in trying to get debt relief as mass flight suspensions cause carriers to seek financial help from governments and investors.

A senior lawyer at Kudun & Partners Ltd., which is representing bondholders, said in March that their initial response to the proposed restructuring was favorable. Thailand’s finance ministry, the Bangkok-based airline’s largest shareholder, indicated its backing for the debt plan that same month.