Balkan Airlines recovery plan is unacceptable, claims IATA

Airline Industry Information, April 23, 2002

AIRLINE INDUSTRY INFORMATION-(C)1997-2002 M2 COMMUNICATIONS LTD

The International Air Transport Association (IATA) has stated that Bulgaria's Balkan Airlines recovery plan is unacceptable.

The recovery plan, which would give the airline's creditors equity stakes in return for cancelling its debts, envisages that it would repay its debt to IATA within five years - 20% in the third year, 30% in the fourth and the rest in the fifth. However, the association feels that the recovery plan is unacceptable and says that the plan will not help to restore the airline's participation in the IATA clearing house.

The plan, drafted by the airline's two court-appointed administrators, is due to be approved by creditors on 20 May. If rejected, the airline will face liquidation, reported Reuters.

((Comments on this story may be sent to aii.feedback@m2.com))