Indonesian flag-carrier PT Garuda Indonesia Tbk is in the midst of trying to restructure its liabilities which include Indonesian bank debt, English law governed aircraft lessors and a $500 million sukuk due 2023. The company is currently subject to a domestic temporary in-court restructuring, or PKPU, proceeding and has guided that its restructuring may also involve an English law scheme of arrangement.
Given the inclusion of English law governed aircraft lessors and the sukuk, the rule in Gibbs and the Cape Town Convention may need to be considered in any Garuda restructuring. How the inclusion of a possible English law scheme of arrangement would operate in the context of the airline’s separate Indonesian PKPU process would also need to be considered.
In this webinar Reorg’s Managing Editor Stephen Aldred discussed with guests from Ashurst – partners Robert Child and Prawidha Murti – the Garuda situation, the potential interplay between English and Indonesian legal aspects and what this may mean for the airline’s restructuring.
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