Greylag SPVs file another lawsuit against Garuda Indonesia

A disgruntled aircraft lessor is continuing its legal battle to derail the Garuda Indonesia (GA, Jakarta Soekarno-Hatta) restructuring. In the latest move in an ongoing legal tit-for-tat, two Ireland-based special-purpose vehicles (SPVs), Greylag Goose Leasing 1410 and 1446, are again suing to bankrupt the airline and derail the near-completed restructuring process.

Reuters reports that Greylag Goose Leasing 1410 and 1446, SPVs used by the New York-based Avenue Capital Aircraft Holdings, filed applications to nullify the restructuring at the Central Jakarta District Court on February 6, 2023. The two SPVs, which each leased a single widebody Airbus to Garuda in 2013, have proved outliers amongst the airline’s many creditors by refusing to support the court-approved restructuring process, preferring insolvency, and waging an ongoing legal campaign to achieve this. Garuda had successfully persuaded enough of its creditors to accept payment of USD5.1 billion (mostly in equity) on total claims of USD9.5 billion to get the Central Jakarta District Court to ratify the debt restructuring agreement in October 2022.

But in this week’s filing, the SPV’s allege negligence during the restructuring, saying that the airline has failed to carry out its obligations, and requested that Garuda be declared bankrupt. Similar windup attempts by the Greylag SPVs last year in courts in Australia, France, and Indonesia failed.

Greylag Goose Leasing 1410’s A330-200 PK-GPQ (msn 1410) and Greylag Goose Leasing 1446’s A330-300 PK-GPR (msn 1446) remain idle at Jakarta’s Soekarno Hatta Airport, with Avenue Capital reportedly refusing to take possession of the unwanted planes. Last year, after Garuda’s administrators worked through creditor claims, the Greylag SPVs refused to accept the offered IDR2.3 trillion rupiah (USD152 million dollars), saying that they were owed IDR5.99 trillion (USD395.8 million). Avenue Capital declined ch-aviation’s request for comment.

In a February 8 statement, Garuda chief executive Irfan Setiaputra said the airline was yet to receive formal notice from the court of the new lawsuit. In early January, the airline hit back over last year’s lawsuits, filing its own countersuit against the SPVs for IDR10 trillion (USD660.8 million) in damages and compensation. Among other matters, Garuda Indonesia alleges that the two Greylag entities unlawfully attempted to obtain settlements outside the agreed provisions of the court-approved restructuring plan. That matter remains before the Indonesian courts.