Alitalia files Chapter 15 bankruptcy case, looks to protect operations

By Caroline Salls

Pittsburgh, June 13 – Alitalia - Societa Aerea Italiana SpA made a Chapter 15 bankruptcy filing Monday in the U.S. Bankruptcy Court for the Southern District of New York to gain U.S. court recognition of its Italian extraordinary administration procedure.

According to a statement filed with the court by vice president regional manager Americas Benedetto Mencaroni Poiaini, Terminal One Group Association, LP provided notice that it would terminate the company’s lease and contract for various crucial services at John F. Kennedy International Airport in New York on June 13 if its claims remained unpaid.

“Such termination would render the debtor immediately unable to operate its daily flights to and from New York, cutting off a substantial revenue stream of the company,” Poiaini said.

In addition, Poiaini said Broadband Centric Inc. provided notice that it will terminate its contracts for the provision of internet and telephone services to Alitalia’s U.S. operations on June 20 if its claims remain unpaid, which would render the company unable to continue operating its call center or conduct routine office activities and thus immediately disrupt its operations in the United States.

As a result, Alitalia filed the Chapter 15 case to obtain an injunction against unilateral changes in the terms of business relationships and against the seizure of assets by creditors.

A temporary restraining order was granted Monday by U.S. bankruptcy judge Sean H. Lane. A hearing on a preliminary injunction is scheduled for June 26.

As previously reported, a negative employee referendum vote noted at a shareholders’ meeting “has determined the inability to implement the relaunch and restructuring of the company.”

Given the inability to refinance “and the impossibility to find in a short period of time an alternative,” Alitalia said in May that its board unanimously voted to proceed with the extraordinary administration filing.

The company is represented in the Chapter 15 case by Freshfields Bruckhaus Deringer US LLP.

Alitalia is an airline based in Rome. The Chapter 15 case number is 17-11618.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.