Mexicana seeks to extend bankruptcy cover

Mexicana seeks to extend bankruptcy cover

Stricken airline Mexicana de Aviación has said it expects to be granted a three month extension to bankruptcy protection as it seeks to return to the skies.

The airline was granted protection from creditors on September 28th last year.

However, Mexican law allows companies 185 days to enter and exit bankruptcy protection, with the possibility of a 90-day extension if there are clear signs of progress toward restructuring.

Mexicana’s legal protection from creditors will expire April 1st without the extension.

The additional protection will allow the carrier more time to round up potential investors before being required to liquidate.

Mexicana, along with domestic subsidiaries MexicanaClick and MexicanaLink, is owned by a group of investors known as Tenedora K.

The consortium purchased up the airlines’ holding company equity after it filed for bankruptcy protection in August.

However, the group has since failed to secure agreements needed to re-launch the carrier.