Avianca Holdings SA, one of Latin America’s largest airlines, lined up a $2 billion bankruptcy-loan package to finance its stay in chapter 11 from a group of investors and lenders including United Airlines Inc. and Chairman Roberto Kriete, WSJ Pro Bankruptcy reported. Since filing for bankruptcy in May after the coronavirus pandemic curtailed flying, Avianca has been working to raise capital to stay in business as air travel remains deeply depressed world-wide. With the loan proposal, the three large Latin American airlines pushed into bankruptcy by the pandemic — Avianca, Latam Airlines Group SA and Grupo Aeromexico SAB — have all found sources of private capital to weather the financial impact of COVID-19. Avianca is fast running out of cash, with its balance down to $150 million. The airline expects to remain in the red for at least eight more months, according to a court filing by Avianca’s investment banker John Luth. It resumed commercial flights Sept. 1. The loan package is backed by the company’s LifeMiles loyalty program, estimated to be valued at as much as $1.6 billion, as well as by its cargo business, according to Luth’s declaration.
