Creditors approve Nok Air’s rehabilitation plan

A committee of creditors has approved Nok Air’s proposed rehabilitation plan and decided not to appoint its own administrators but rather let the airline execute the plan under self-appointed administrators.

During a virtual meeting held on August 4, creditors collectively holding 76.72% of the Thai carrier’s liabilities voted in favour of the plan. To proceed, the airline needed the approval of creditors holding at least half of its registered debt.

The plan will now be submitted for final approval by the Central Bankruptcy Court, which is expected during a meeting scheduled for August 26, 2021. Barring last-minute objections for major creditors, the court usually follows the decision of the committee.

Nok Air said earlier that it was not expecting any hurdles with approval of the plan considering that the carrier’s main shareholders and creditors, the Jurangkool family, resolved to pursue the rehabilitation. The airline finalised the plan in mid-May 2021.

The Stock Exchange of Thailand (SET) warned the carrier, whose shares have been suspended from trading since July 2, 2021, that it would face permanent delisting if it does not submit its financial report for 2020 by September 1, 2021. Nok Air previously said that it would only submit the report once the creditors approve its rehabilitation plan.

Meanwhile, Nok Air said it would suspend all domestic flights through the end of August 2021, following the Thai government’s decision to extend and expand a COVID-related lockdown. Current measures are in place through August 18, although the authorities indicated they could be extended if the number of cases does not decline meaningfully. Rival carriers Thai AirAsia and Thai Lion Air suspended all of their fights through August 31 and August 15, respectively.