Thai Airways disputes $7.4bn of aircraft lessor claims
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Thai Airways International Plc is challenging some US$7.4 billion in claims from dozens of aircraft lessors and engine service provider Rolls-Royce Holdings Plc, saying it is not liable for the monies because they concern future expenses and were incurred after the airline received bankruptcy protection from a Bangkok court.
Thailand’s flag carrier, which is undergoing a court-supervised restructuring to trim debt and return to profit by raising fresh capital, is disputing around 192 billion baht ($6.3 billion) claimed by 48 lessors including BOC Aviation Ltd and SMBC Aviation Capital Ltd, and another 33 billion baht that Rolls-Royce says it is owed for maintenance services, according to a copy of the debt rehabilitation plan seen by Bloomberg.
A spokesperson for Thai Airways declined to comment. Representatives from BOC Aviation, and Rolls-Royce and SMBC Aviation in Europe also declined to comment.
The disputed amount is more than half of Thai Airways’ total liabilities of 410 billion baht. Yet an amicable settlement with creditors is key for the airline to stave off bankruptcy.
Questions & Answers
Q.Which specific companies are involved in the disputed claims against Thai Airways?
Which specific companies are involved in the disputed claims against Thai Airways?
The claims are being disputed with 48 aircraft lessors, including BOC Aviation Ltd and SMBC Aviation Capital Ltd. Also, engine service provider Rolls-Royce Holdings Plc is involved in the dispute.
Q.What is the total value of claims that Thai Airways is disputing, expressed in Thai baht?
What is the total value of claims that Thai Airways is disputing, expressed in Thai baht?
Thai Airways is disputing approximately 192 billion baht from the aircraft lessors. Rolls-Royce is claiming another 33 billion baht for maintenance services, making the total disputed amount 225 billion baht.
Q.Why is Thai Airways disputing these claims from lessors and Rolls-Royce?
Why is Thai Airways disputing these claims from lessors and Rolls-Royce?
Thai Airways argues it is not liable for the monies because they pertain to future expenses. The airline also states these expenses were incurred after it received bankruptcy protection from a Bangkok court.
Q.How significant is the disputed amount compared to Thai Airways' overall debt?
How significant is the disputed amount compared to Thai Airways' overall debt?
The disputed amount of US$7.4 billion (or 225 billion baht) represents more than half of Thai Airways’ total liabilities. The airline's overall debt stands at 410 billion baht.
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