Latam Airlines Group’s Brazilian subsidiaries join Chapter 11 cases

By Caroline Salls

Pittsburgh, July 10 – Latam Airlines Group, Inc.’s Brazilian subsidiaries have joined the company’s Chapter 11 bankruptcy proceedings, according to an order filed Friday with the U.S. Bankruptcy Court for the Southern District of New York.

The Brazilian debtors include TAM SA, TAM Linhas Aereas SA, Aerolinhas Brasileiras SA, Prismah Fidelidade Ltda., Fidelidade Viagens e Turismo SA, TP Franchising Ltda., Holdco I SA, Multiplus Corredora de Seguros Ltda. and Piquero Leasing Ltd.

The Brazilian debtors’ cases, which were filed on July 7 and July 8, will be jointly administered under the Latam Airlines Group lead case.

The company said in the joint administration motion that “the same issues that affected the initial debtors remain particularly acute for the subsequent debtors, who are almost entirely based in Brazil, where the number of daily Covid-19 infections continues to increase.”

In addition, while it had hoped that the subsequent debtors could continue to operate independently outside of Chapter 11, Latam said many contract counterparties and trade vendors have used the Chapter 11 filing of the initial order as justification to restrict or impair trade terms, cease service or otherwise impair the subsequent debtors’ ability to continue to do business.

Latam also said the Brazilian debtors are approaching a number of significant debt obligations.

Latam is a Santiago-based airline. The company filed bankruptcy on May 25 under Chapter 11 case number 20-11254.

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