South American carrier Latam Group has started the final phase of reorganisation under US Chapter 11 bankruptcy protection.
The group expects to raise $8 billion alongside exit financing as part of a balance sheet restructuring exercise.
The company updated its cost savings estimate last month from $900 million to more than $1 billion annually, resulting from initiatives that have already been implemented.
Latam has a presence in Brazil, Chile, Colombia, Ecuador and Peru, as well as international operations within Latin America and to Europe, Oceania, the US and Caribbean.
But the pandemic forced the airline to initiate a reorganisation process in the US in May 2020, seeking protection from creditors.
It runs a fleet of Boeing 767, 777, 787, Airbus A321, A320, A320neo and A319 aircraft.
Latam won court approval to exit Chapter 11 in June.
It expects a recovery in domestic markets to 2019 levels by the end of 2022 but international traffic recovery will be slower, reaching pre-pandemic levels by mid-2023. International traffic accounted for about 45% of 2019 revenues.
Chief executive Roberto Alvo described the latest move as “taking the final step in our Chapter 11 process, with a view to emerge no later than November, well positioned for the future”.