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dcajet
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Posts: 4920
Joined: Sun Aug 01, 2004 9:31 am

PAL Philippine Airlines to file for Chapter 11

Thu May 06, 2021 12:11 am

Per many sources (Cirium and Flight Global among them) PAL Philippine Airlines has informed its lessors of a plan to file for Chapter 11 bankruptcy protection in the USA by the end of May, Norton Rose Fulbright (US) is the airline’s counsel on the restructuring and Seabury Capital (US) has been hired as a restructuring adviser.

https://www.flightglobal.com/airlines/p ... 81.article
Keep calm and wash your hands.
 
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LAXintl
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Re: PAL Philippine Airlines to file for Chapter 11

Thu May 06, 2021 12:19 am

They have been threatening BK for several months now. That along with latest news already being covered in >>> viewtopic.php?f=3&t=1456059
From the desert to the sea, to all of Southern California
 
jbs2886
Posts: 2943
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Re: PAL Philippine Airlines to file for Chapter 11

Thu May 06, 2021 12:29 am

LAXintl wrote:
They have been threatening BK for several months now. That along with latest news already being covered in >>> viewtopic.php?f=3&t=1456059


It's being covered in the Philadelphia thread? Either way, I think this is fine as its own topic, I never would have known about it reading a generic mega thread.
 
dcajet
Topic Author
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Re: PAL Philippine Airlines to file for Chapter 11

Thu May 06, 2021 12:36 am

LAXintl wrote:
They have been threatening BK for several months now. That along with latest news already being covered in >>> viewtopic.php?f=3&t=1456059


I thought this is important enough to warrant its own thread. It gets lost in those generic threads that most users may not open.
Keep calm and wash your hands.
 
smi0006
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Re: PAL Philippine Airlines to file for Chapter 11

Thu May 06, 2021 12:41 am

Does this mean they will file for bankruptcy in the Philippines though? Haven’t a few non-US airlines done this in the US with no operational impact?
 
dcajet
Topic Author
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Re: PAL Philippine Airlines to file for Chapter 11

Thu May 06, 2021 12:45 am

smi0006 wrote:
Does this mean they will file for bankruptcy in the Philippines though? Haven’t a few non-US airlines done this in the US with no operational impact?


It appears the filing will be done in US courts, just as Avianca and LATAM did.
Keep calm and wash your hands.
 
asuflyer
Posts: 715
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Re: PAL Philippine Airlines to file for Chapter 11

Thu May 06, 2021 1:43 am

smi0006 wrote:
Does this mean they will file for bankruptcy in the Philippines though? Haven’t a few non-US airlines done this in the US with no operational impact?


The US, particularly the Southern District of New York is a preferred destination for bankruptcy and restructuring for companies with global exposure as the courts and law firms are well setup to handle large bankruptcy cases. During the bankruptcy contracts and items like aircraft leases, employees, suppliers can be renegotiated and terminated in ways that are more favorable for the company. So while the PR will continue to operate on a day to day basis they could easily reject aircraft leases that are too expensive and divest of assets that are financially burdening.
 
RTWin10
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Re: PAL Philippine Airlines to file for Chapter 11

Thu May 06, 2021 3:35 am

catiii wrote:
dcajet wrote:
LAXintl wrote:
They have been threatening BK for several months now. That along with latest news already being covered in >>> viewtopic.php?f=3&t=1456059


I thought this is important enough to warrant its own thread. It gets lost in those generic threads that most users may not open.


I doubt it's being covered in the Philadelphia thread...

You're right to start a new thread.


I believe he was referring to the Philippine Aviation Thread 2021. viewtopic.php?f=3&t=1455999&start=100

There are several posts regarding details of how PR is going about the pre-packaging of the bankruptcy, etc.
 
catiii
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Joined: Mon Mar 31, 2008 1:18 am

Re: PAL Philippine Airlines to file for Chapter 11

Thu May 06, 2021 4:24 am

RTWin10 wrote:
catiii wrote:
dcajet wrote:

I thought this is important enough to warrant its own thread. It gets lost in those generic threads that most users may not open.


I doubt it's being covered in the Philadelphia thread...

You're right to start a new thread.


I believe he was referring to the Philippine Aviation Thread 2021. viewtopic.php?f=3&t=1455999&start=100

There are several posts regarding details of how PR is going about the pre-packaging of the bankruptcy, etc.


The thread he quoted in the post is a Philadelphia thread.
 
roadrunner165
Posts: 889
Joined: Sun Oct 15, 2000 6:28 am

Re: PAL Philippine Airlines to file for Chapter 11

Thu May 06, 2021 6:11 am

Any idea how this bankruptcy would affect passengers holding credits for future flights?

I messed up and took a credit voucher for future travel instead of a credit card refund when Covid hit. And I have been looking for a way out ever since. PAL initially said a refund to credit card could take upwards of 5 cycles to to process, meaning it could be 5 months before I got a credit back to my card. Come to find out that was a load of crap they were using to scare people into taking the voucher. I should have said refund to card and then disputed the charge with Visa and Bank of America when the credit wasn't issued within a reasonable time frame. But I digress....

Adam
 
filipinoavgeek
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Re: PAL Philippine Airlines to file for Chapter 11

Thu May 06, 2021 6:43 am

With how much PR is struggling these days, this should put to rest any discussion or hope of PR ordering any new types for the foreseeable future, whether it be the 787 or the A330neo.
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2007 - 2019
 
RDRogel
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Re: PAL Philippine Airlines to file for Chapter 11

Thu May 06, 2021 9:50 am

and joining PAL into Oneworld Alliance.
 
MIflyer12
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Joined: Mon Feb 18, 2013 11:58 pm

Re: PAL Philippine Airlines to file for Chapter 11

Thu May 06, 2021 10:32 am

roadrunner165 wrote:
Any idea how this bankruptcy would affect passengers holding credits for future flights?


I'm not a lawyer but I believe a Ch 11 filing would allow PAL to reject these obligations. That generates a lot of ill-will among many so they may not choose to reject.
 
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jfklganyc
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Re: PAL Philippine Airlines to file for Chapter 11

Thu May 06, 2021 11:00 am

MIflyer12 wrote:
roadrunner165 wrote:
Any idea how this bankruptcy would affect passengers holding credits for future flights?


I'm not a lawyer but I believe a Ch 11 filing would allow PAL to reject these obligations. That generates a lot of ill-will among many so they may not choose to reject.


The reason most companies don’t usually reject future applications like that is because it is low hanging fruit (in the grand scheme of things) and it alienates customers.

PR isnt restructuring to wipe out your $1500 credit.
 
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NearMiss
Posts: 207
Joined: Sun May 22, 2016 5:10 pm

Re: PAL Philippine Airlines to file for Chapter 11

Thu May 06, 2021 11:15 am

I think they were struggling even before Covid-19. Hopefully they'll bounce back.
"There is an art, it says, or rather, a knack to flying. The knack lies in learning how to throw yourself at the ground and miss."
 
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Polot
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Re: PAL Philippine Airlines to file for Chapter 11

Thu May 06, 2021 11:26 am

jfklganyc wrote:
MIflyer12 wrote:
roadrunner165 wrote:
Any idea how this bankruptcy would affect passengers holding credits for future flights?


I'm not a lawyer but I believe a Ch 11 filing would allow PAL to reject these obligations. That generates a lot of ill-will among many so they may not choose to reject.


The reason most companies don’t usually reject future applications like that is because it is low hanging fruit (in the grand scheme of things) and it alienates customers.

PR isnt restructuring to wipe out your $1500 credit.

It also only hurts them when the passenger actually uses the credit...and a surprising number of people never do and let them expire.

Rejecting them also doesn’t really free up cash for the airline in the short term. Credits just impact future revenue (minimally).
 
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SEPilot
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Re: PAL Philippine Airlines to file for Chapter 11

Thu May 06, 2021 2:41 pm

Not surprising. They have always seemed to me to be on shaky financial ground, and COVID has been very hard on all airlines. And the Philippines seem to have been extremely harsh (unnecessarily so) with their lockdown rules. I have flown PAL when I have been in the Philippines only because the alternatives seem worse. My wife is from Dipolog, which is about 500 miles south of Manila. So the choice to get there is PAL, Cebu Pacific, or a two day boat ride. I have heard and read enough horror stories about Cebu Pacific to avoid them if possible. And my wife is dead set against the two day boat ride (which also costs just as much). An interesting aside; when we first met in 2013 flights from Manila to Dipolog were sparsely populated; getting a seat at short notice was no problem. That has dramatically changed; they have been booked solid for two to three weeks in advance every time we have tried to book a seat, either for ourselves or for family.
The problem with making things foolproof is that fools are so doggone ingenious...Dan Keebler

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