LATAM files for Chapter 11 bankruptcy

LATAM, Latin and South America’s largest airline, has filed for Chapter 11 bankruptcy in the USA. LATAM has 7 subsidiaries: LATAM Argentina, LATAM Paraguay, LATAM Chile, LATAM Peru, LATAM Brasil, LATAM Columbia and LATAM Ecuador. However, LATAM Brasil, Argentina and Paraguay haven’t filed for bankruptcy. Robert Alvo, CEO of LATAM, has announced: “LATAM entered the COVID-19 pandemic as a healthy and profitable airline group, yet exceptional circumstances have led to a collapse in global demand and has not only brought aviation to a virtual standstill, but it has also changed the industry for the foreseeable future.We have implemented a series of difficult measures to mitigate the impact of this unprecedented industry disruption, but ultimately this path represents the best option to lay the right foundation for the future of our airline group. We are looking ahead to a post-COVID-19 future and are focused on transforming our group to adapt to a new and evolving way of flying, with the health and safety of our passengers and employees being paramount.” This is the second Chapter 11 bankruptcy in South America this year, after Avianca (the second biggest airline in South and Latin America). On top of this, TAME, the flag carrier of Ecuador, has ceased operations this month. LATAM’s current share price is a very low $2.58, so watch out! Do NOT invest in airline stocks this month. It could prove to be a very fatal decision financially. 26th of May 2020.

BAD news for LATAM.

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