Thai Airways’ restructuring plan up for further review

The Thai government has ordered the board of Thai Airways International (TG, Bangkok Suvarnabhumi) to conduct “a further review” of its proposed rehabilitation plan and develop better solutions regarding, among others, debt restructuring, Deputy Prime Minister Supattanapong Punmeechaow told local media. Following a meeting with the carrier’s board, Supattanapong said the current plan was not specific enough in its financial aspects, including the proposed method for debt restructuring, securing cash reserves, and financing the debt servicing cost. “We need to do a lot more homework and weigh the information we have carefully to pinpoint the airline’s real debt-servicing capacity,” Supattanapong said. He also acknowledged that further privatisation of the airline was possible as a way forward. Formally, Thai Airways lost its standing as a majority state-owned enterprise in May 2020, when the Ministry of Finance sold a 3.17% stake in the airline, thus reducing its shareholding to 47.9%. However, a further 17.8% stake is currently owned by state-owned Vayupak Fund, while other state-owned banks and financial institutions hold smaller stakes. Supattanapong tasked the Ministry of Finance, as the ministry directly responsible for the oversight of Thai, to lead the work on the new plan. After it had used two requests for postponement, the carrier is now facing a rigid deadline of March 2 to submit the rehabilitation plan to the Central Bankruptcy Court. The failure to do so, or the rejection of the plan by creditors, could jeopardise the airline’s existence. Supattanapong suggested the plan should enable the airline to achieve financial sustainability within two years. He added that the airline’s transformation could be used as a blueprint for other ailing state-owned companies in Thailand if successful.