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Latino Daily News

Wednesday February 1, 2012

Troubled Mexican Airline Could Once Again Begin Operations as Early as March

Troubled Mexican Airline Could Once Again Begin Operations as Early as March

Photo: Troubled Mexican Airline Could Once Again Begin Operations as Early as March

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The judge presiding over Mexicana de Aviacion’s bankruptcy proceedings said a consortium has deposited $300 million to recapitalize the Mexican airline, which could return to the skies next month.

Felipe Consuelo Soto told Radio Formula that Med Atlantica, which is 80 percent controlled by Mexican investors, has shown it has the necessary funds and is now the best option for rescuing the beleaguered carrier.

“The group brings together the elements to be awarded Mexicana de Aviacion. It’s shown me that it has the money and the willingness to restructure Mexicana,” the judge said.

Soto said he has petitioned the Communications and Transportation Secretariat to reactivate Mexicana’s operating permit.

He added that the carrier’s bankruptcy proceedings will conclude after a few administrative formalities have been completed.

“This is wonderful news for the (airline’s) 8,000 workers,” the judge said, adding that the secretariat still must decide if Med Atlantica meets the technical requirements.

More than 30 potential suitors have expressed interest in the airline since the start of the bankruptcy proceedings, with Med Atlantica, Union Swiss, the Ivan Barona group and Grupo Lomex reaching the final stage.

PC Capital and Barona’s group seemed poised at one juncture to rescue Mexicana but they were unable to demonstrate they had the required funds.

The Mexicana group of airlines, which also includes sister budget carriers Click and Link, halted operations and filed for bankruptcy protection in 2010 after racking up an estimated 12 billion pesos ($930 million) in debt.