THAI Rehabilitation Plan in progress; financial advisor not hired for 630MB

Air Chief Marshal Chaiyapruk Didyasarin, Chairman of the Board of Directors, Thai Airways International Public Company Limited (THAI), revealed the progress of the rehabilitation plan prepared by six planners and EY Corporate Advisory Services, together with the legal advisor, aviation business consultant, and financial advisor. The plan consists of the following.

1. Business Plan, which includes the revenue increase plan, expense reduction, work process adjustment, and organizational restructuring to sustainably increase efficiency and prepare for accommodating future business operations. As of now, THAI has partially proceeded with the work plan such as granting voluntary leave without pay and making sacrifices for the organization projects in order to decrease the Company’s hiring expenses. The Business Plan is almost complete.

2. Financial Plan, which includes debt and capital restructuring. Regarding the issue of dealing with a large number of creditors, the repayment of debt under the rehabilitation plan must be fair to all creditors. At the present, all applications for debt repayment are now being thoroughly checked in order to ensure that the debts that are entitled to receive the repayment under the rehabilitation plan are correct. Meanwhile, a financial model must be established as a guideline to determine the pattern of capital and debt restructurings and several arrangements need to be set up for the allocation of debt repayment to be presented for the creditors' consideration.

THAI has transparently hired a professional financial advisor according to the company's procurement and recruitment regulations. The financial advisor provided THAI with financing and accounting advice in preparing a financial structure, capital structure, shareholders modelling, cash flow analysis, and financial analysis of THAI for current and future states, which will be incorporated into the rehabilitation plan. Moreover, the aforementioned matters will be presented to the creditors and stakeholders as a financial part in the rehabilitation plan to ensure them with a credible and sensible financial principle. THAI's budget to hire the financial advisor is capped at 60 million Baht. The financial advisor will be obligated to assist THAI until the rehabilitation plan is approved by the Central Bankruptcy Court, and the financial advisor will bear no obligations in finding or contacting a new source of funds for THAI. Therefore, THAI hereby denies the rumors regarding the hiring of financial consultancy worth 630 million Baht.

For the module of finding the new source of funds or new investors, the hiring will be conducted after the rehabilitation plan is approved by the Central Bankruptcy Court and the creditors.

As THAI attends to a large number of creditors from several classes which are relevant to various segments, the planner urgently discussed with the creditors in several classes to define the best solution for the approval of rehabilitation plan from all parties as soon as applicable. After receiving the opinions from several classes of creditors, it appeared that THAI received good feedback in that most creditors were in favor of the principle of the rehabilitation plan. In addition, the creditors provided useful comments for the preparation of the rehabilitation plan. In order to generate an optimal financial plan, the planner has considered extending the deadline to submit the rehabilitation plan to the court for 1 month, which is in accordance with the law. As such, the rehabilitation plan would proceed with the submission by late February or early March 2021.

After the planner submits the rehabilitation plan, the official receiver will send a copy of the rehabilitation plan to the creditors for their consideration and approval in the creditors' meeting. These processes would take approximately 1.5 months. Once the rehabilitation plan is approved by the creditors, it then rests on the court's final verdict.
All of THAI's staff and management team are pleased and determined to provide cooperation in order to support the preparation of the rehabilitation plan for success. Despite the challenges in operating the business, all of THAI's staff heed this matter and are committed to continuously reduce expenses and increase the revenue of THAI.

Moreover, THAI has received cooperation from all relevant and concerned persons, as well as creditors, partners, and customers who are vital for the success of the preparation of the rehabilitation plan. The planner asserts that the rehabilitation plan would be well regarded and successful, as the creditors will receive the repayment of debt in fairness. THAI expects to resume full operations in the near future.