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Bankruptcy court to rule Feb on Avianca extension
Thu January 29, 2004 04:20 PM ET
BOGOTA, Colombia, Jan 29 (Reuters) - A U.S. bankruptcy judge
postponed until Feb. 10 a decision on whether to grant Colombian airline Avianca
another deadline extension -- this time until March 30 -- to present a
restructuring plan, creditors said on Thursday.
If granted, the deadline
extension would be Avianca's fifth.
Colombia's flagship carrier,
struggling to keep itself in the air and a possible acquisition target by
Continental Airlines (CAL.N: Quote,
Profile,
Research)
, had until Jan. 30 to present the plan. It requested the extension two weeks
ago.
Last March, Avianca and its U.S. subsidiary filed for Chapter 11
bankruptcy protection in the United States, hurt by high fuel costs and slack
demand stemming from the political and economic crises in Venezuela and
Argentina.
Avianca has a U.S. subsidiary, which allowed it to apply for
Chapter 11 proceedings to try to renegotiate at least $269 million in debt while
continuing to operate. The U.S. law is more generous with struggling debtor
companies than Colombian legislation.
A source close to Avianca said
earlier this week that Continental Airlines Inc. (CAL.N: Quote,
Profile,
Research)
, the No. 5 U.S. airline, is negotiating the possible purchase of the struggling
airline. Continental declined comment
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Editor Kayla Bello
Latin Women Forum
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