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LATAM Airlines shares plummet 85% after restructuring plan revealed

EconomyNov 29, 2021 08:25AM ET
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© Reuters. FILE PHOTO: LATAM Airlines plane is seen at Santiago International Airport, Chile March 30, 2017. REUTERS/Ivan Alvarado/File Photo

By Fabian Cambero

SANTIAGO (Reuters) - Shares of LATAM Airlines (OTC:LTMAQ), Latin America's largest air transport group, plunged on the Chilean stock exchange on Monday after an announcement by the indebted carrier over the weekend of a restructuring plan that would dilute shares in the company.

The airlines' shares collapsed by almost 85% in early trading.

On Friday the firm said it had filed a reorganization plan, proposing an $8.19 billion infusion of capital into the group, in a bid to exit its Chapter 11 bankruptcy.

The financing proposal will include a mix of new equity, convertible notes and debt, the group said in a statement, adding that it intends to launch an $800 million equity rights offering to shareholders upon confirmation of the plan.

Brazilian airline Azul SA (NYSE:AZUL) on Monday said that it made an offer this month to combine with LATAM Airlines, but said the Chilean-listed firm was over-valued and that it had since decided to focus on its own operations.

LATAM Airlines shares plummet 85% after restructuring plan revealed
 

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