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Grupo Aeromexico, which operates Mexico's largest airline, reported on Tuesday a net loss of 2.24 billion pesos ($108.7 million) in the third quarter, versus a net loss of 2.88 billion pesos from the same period last year, Reuters reported. Aeromexico, which has been undergoing a reorganization under chapter 11 of the Bankruptcy Code in the U.S., posted 13.23 billion pesos in revenue for the third quarter, up from 4.67 billion a year earlier. The airline said that its total capacity, as measured in available seat kilometers (ASKs), increased 24.8% compared to the second quarter of 2021, driven by the recovery of 35.4% in capacity assigned to the international market and 11.6% to the domestic market.

Mexican airline Grupo Aeromexico SAB de CV has filed a reorganization plan that includes a financing proposal largely backed by a group of senior noteholders and unsecured creditors and allow the carrier to shed $1 billion from its debt stack, Reuters reported. In court papers filed late Friday, Aeromexico says it is continuing to “actively negotiate with various stakeholders regarding an exit financing package” based on the noteholders and trade creditors’ joint proposal to bring in as much creditor support for the plan as possible. The airline, represented by Davis Polk & Wardwell, filed for chapter 11 in June 2020 with $2 billion in debt, blaming the downturn in travel demand caused by the COVID-19 pandemic. Aeromexico plans to ask U.S. Bankruptcy Judge Shelley Chapman in Manhattan to grant approval for it to begin soliciting creditor votes on the plan at a hearing on Oct. 25. The joint proposal includes $1.1875 billion in new equity and $537.5 million in new secured debt. The new financing would be used to refinance or pay off all or some of $1 billion in loans used to fund operations during the bankruptcy. It would also be used to cover costs necessary to emerge from chapter 11, to set up a cash-out option for general unsecured creditors and acquire Aimia Holdings UK Ltd’s interest in the airline's travel loyalty program, PLM Premier. The joint proposal puts Aeromexico's total enterprise value at $5.4 billion. Aeromexico says the plan would save nearly 13,000 jobs worldwide.

Beleaguered Italian ferry operator Moby SpA dropped its request for an order blocking Morgan Stanley from trading in the company’s debt or interfering in its restructuring, Bloomberg News reported. Moby told a federal court in New York late Sunday that it was withdrawing its application for a temporary restraining order against the bank, which it accused in a Sept. 27 lawsuit of participating in a secret plan to foil its restructuring in Italy and seize control from other creditors. The company, which operates ferries between the Italian mainland and islands like Sardinia, said it would now be seeking Italian court permission to pursue its claims through a chapter 15 U.S. bankruptcy filing. Morgan Stanley on Friday filed court papers deriding the U.S. lawsuit as a meritless attempt to dictate the outcome of Moby’s Italian restructuring proceedings. The bank said Moby failed to show that Morgan Stanley interfered in Moby’s relationship with its creditors or that it had done anything wrong in purchasing the company’s bonds.

LATAM Airlines Group, the region's largest carrier, said yesterday that it had secured additional financing of up to $750 million, a key step in a bankruptcy protection process the airline initiated in 2020, Reuters reported. LATAM filed for bankruptcy protection in the U.S. in May 2020 as world travel came to a halt amid the coronavirus pandemic. At the time, it was the world's largest airline to take such action due to COVID-19. The fresh funds announced on Wednesday were obtained for Tranche B of the debtor-in-possession (DIP) financing, the airline said in a statement, "at rates and more competitive conditions than those obtained for Sections A and C, which will allow the group to improve its cost of financing under Chapter 11." LATAM's board of directors unanimously approved the offer, which came from a group composed of Oaktree Capital Management, Apollo Management Holdings "and certain funds, accounts and entities advised by them," the statement said. The proposal must now be approved by the U.S. bankruptcy court overseeing the process. The company said earlier this month it had received several offers to fund its exit from chapter 11 bankruptcy, each of which are worth more than $5 billion.

Federal Reserve officials have questioned several big U.S. banks about their exposure to China’s Evergrande Group, joining other global regulators in examining the potential fallout from the property developer’s debt crisis, Bloomberg News reported. Troubles at Evergrande, with more than $300 billion of liabilities, has reportedly spurred the Fed to seek information to head off any risks to financial stability. Hong Kong’s central bank also asked lenders there to report risks tied to Evergrande, China’s largest issuer of high-yield, dollar-denominated bonds. U.S. banking supervisors routinely question lenders about their ties to struggling companies. Fed Chair Jerome Powell said last week that “there’s not a direct United States exposure,” adding that big Chinese banks also are “not tremendously exposed.” The contagion danger had been similarly dismissed by European Central Bank President Christine Lagarde, who said direct exposure in Europe is “limited.” Powell said his main worry is “that it would affect global financial conditions through confidence channels and that kind of thing.”

Avianca Holdings SA won court approval to send its reorganization plan to creditors for a vote, bringing the Colombian air carrier one step closer to exiting bankruptcy under new ownership, Bloomberg News reported. Lenders and noteholders who agreed to refinance their debt at the beginning of Avianca’s bankruptcy case last year will get 72% of the airline’s equity in exchange for canceling about $934.7 million, according to court papers. U.S. Bankruptcy Judge Martin Glenn said he would approve a disclosure statement that will be sent to creditors in the U.S. and Colombia that they can use to decide whether to support the debt restructuring plan. Under the proposal, the company will eliminate about $3 billion in debt, the company said. Avianca was Latin America’s second-largest airline before the COVID-19 pandemic slowed air travel to a trickle last year, leading it to file for chapter 11 protection in a New York court in May of 2020. Latam Airlines Group SA and Mexico’s Grupo Aeromexico SAB also were forced into bankruptcy as the region suffered one of the world’s sharpest drops in flights.

Limetree Bay Refinery proposed new deadlines for the bidding and sale of its bankrupt oil refining operations on Friday that will be heard, and likely approved, in the Bankruptcy Court of the Southern District of Texas on Wednesday, Sept. 15, StThomasSource.com reported. Under the current schedule, Limetree was to have identified a stalking horse, or low-end bidder, by Friday, and close a sale by Nov. 8. The extension of more than a month allows prospective purchasers additional time to tour the physical plant on St. Croix, Limetree lead bankruptcy counsel Elizabeth Green said. The company reported in August that it had sent almost 20 non-disclosure agreements to possible buyers. While Green couldn’t discuss specifics of who they are, her motion suggests that Limetree, if given more time, could cultivate one who could set a bottom price point for the assets to prevent others from under-bidding the purchase price. As a debtor in possession, Limetree is operating on a short financial leash with a cash loan keeping it afloat until it can realize a sale that would allow its creditors to be paid. It filed for chapter 11 protection in July after a short-lived attempt to revive the circa 1960s St. Croix refinery, previously owned by Hovensa. The company owes over $1.2 billion to secured creditors, according to recent court documents. The proposed new schedule would not require other changes to the DIP order, Green wrote.