World's second-oldest airline, Avianca, driven to bankruptcy by coronavirus

- Avianca Holdings AVT_p.CN, Latin America’s second-largest airline, filed for bankruptcy on Sunday, after failing to meet a bond payment deadline, while its pleas for coronavirus aid from Colombia’s government have so far been unsuccessful.

“Avianca is facing the most challenging crisis in our 100-year history,” Avianca Chief Executive Anko van der Werff said in a news release. Avianca, the second-oldest continually operating airline in the world after KLM , had $7.3 billion in debts in 2019. The airline filed for Chapter 11 bankruptcy in New York and said it would continue operations while it restructured its debts.

Efromovich grew Avianca aggressively but also saddled the carrier with significant debt until he was ousted from the airline last year in a boardroom coup led by United Airlines Holdings Inc . He still owns a majority stake in the carrier.FILE PHOTO: An aerial view shows Colombian airline Avianca's planes parked at El Dorado International Airport amid the coronavirus disease outbreak in Bogota, Colombia April 7, 2020.

Last month, Avianca’s accounting firm, KPMG, said it had “substantial doubts” about the carrier’s ability to exist a year from now.Most pressingly, Avianca was facing a $65 million bond payment due on Sunday that analysts did not think the airline was in a position to meet. S&P downgraded the airline to CCC- status in the days leading up to that payment.

FILE PHOTO: The logo of Avianca Airlines is pictured at a counter following the cancellation of Avianca flight 431, after El Salvador's President Nayib Bukele accused Mexico of allowing a dozen confirmed coronavirus cases to board the flight due to leave Mexico City for San Salvador, at the Benito Juarez International Airport in Mexico City, Mexico, March 16, 2020.

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