Philippine Airlines said Saturday it was filing for bankruptcy in the United States to slash $2 billion in debt as it tries to survive an industry gutted by the coronavirus pandemic.
The national carrier of the Philippines said the filing will allow it to restructure contracts and cut debt by at least $2 billion while getting $655 million in fresh capital when it emerges from the Chapter 11 process.
“Philippine Airlines will continue business-as-usual operations while finalising the restructuring of our network, fleet and organisation,” senior vice president and chief financial officer Nilo Thaddeus Rodriguez said in a video message.
It will also obtain another $150 million in debt funding after it emerges from the restructuring process “in a few months”, Rodriguez said.
The carrier cancelled more than 80,000 flights, wiping out $2 billion in revenue, and let go of 2,300 employees.
Santa Maria said PAL now operates 21 percent of pre-pandemic flights to 70 percent of its usual destinations.