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Wednesday, October 5, 2022
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LIAT SET FOR LIQUIDATION, ASSETS TO BE MOVED TO NEWCO

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The governments of Antigua & Barbuda, Barbados, Dominica, and St. Vincent & the Grenadines – the four major shareholders of LIAT (Antigua and Barbuda) (LI, Antigua) – have resolved to liquidate the debt-ridden company and transfer its assets to newco, LIAT 2020 (LIA, Antigua).

“Commitments were given in support of a new, efficient, and expanded LIAT (2020) Ltd, instead, which heads believe will satisfy the immediate regional travel demand,” Antiguan Prime Minister Gaston Browne told the media following a meeting in early August.

The oldco, known legally as LIAT (1974) Ltd., which has been in bankruptcy restructuring since July 2020, continues to operate three ATR42-600s for the time being and holds both an Antiguan Air Operator’s Certificate and an EU Third Country Operator authorisation, necessary for flights to French and Dutch territories in the Caribbean. LIAT also holds an exemption to serve the US, although granted on a temporary basis and currently due to expire on November 5, 2022.

LIAT 2020 does not yet have an Air Operator’s Certificate. The carrier’s administrator, Cleveland Seaforth, did not respond to ch-aviation’s query as to whether the newco will obtain its own authorisations or acquire the certificates held by the oldco. The timeline for the liquidation of the oldco and the transfer of the assets to LIAT 2020 is also unclear.

Browne then said that the shareholders would enlist an aviation consultancy to advise on LIAT 2020’s business model to ensure its long-term financial viability.

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Meanwhile, Antiguan Information Minister Melford Nicholas told the media in a post-cabinet briefing that LIAT is planning to charter two unspecified aircraft to ramp up its operations as the Caribbean markets recover from the pandemic.

“We are at a stage where LIAT 1974 has continued to operate. Of course, they are encumbered by the limited number of aircraft. So the intention is to scale up the operations to ensure we can have at least two more aircraft available on wet leases for the continuing operation,” Nicholas said.

Nicholas said that the aircraft would be sourced by LIAT 2020. Until the start-up obtains an AOC, it will nonetheless place the aircraft with LIAT 1974.

The carrier did not respond to ch-aviation’s request for more information regarding the ACMI plans.

The Leeward Islands Airlines Pilot Association (LIAPA) has slammed the governments’ decision to liquidate LIAT and appealed for them to treat pilots and other staff members’ needs with the same urgency as the corporate restructuring. Meanwhile, the Antigua & Barbuda Workers Union (ABWU) is seeking an urgent meeting with administrator Seaforth to discuss the fate of the LIAT 1974 oldco. While initially, the union seemed to reject the idea of liquidation outright, in its later communication with Seaforth, the ABWU indicated openness to dialogue and stressed that unions should be involved in the decision-making process.

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