NokScoot Airlines Company Limited, the long-haul low-cost carrier of Thailand, has reportedly announced that it will enter liquidation as the COVID-19 pandemic has significantly impacted its business. The airline’s shareholders will conduct a meeting on July 14 to go ahead with liquidation and to appoint liquidator.
NokScoot, a joint venture between Singapore Airlines' Scoot and Thailand's Nok Air, has been unable to record a profit since its establishment in 2014. The airline said in the statement that it does not see a path to recovery and growth for NokScoot during such challenging circumstances.
Sources cite that NokScoot has retrenched around 425 employees with full benefits due to poor financial conditions. The proposal to liquidize NokScoot is subject shareholders’ approval. The airline will keep shareholders updated on any further material developments.
Thailand is considered a pivotal market for Singapore Airlines Group. Singapore Airlines, Scoot, and SilkAir will continue to cater to customers in Thailand with their existing operations.
The ongoing COVID-19 pandemic has significantly impacted the travel demand across the globe. Recently, Virgin Australia Airlines, one of the biggest airlines in Australia, has reportedly announced that two U.S private equity companies named Bain Capital and Cyrus Capital Partners have emerged as final contenders to take over the airline. Deloitte is acting as the administrator for Virgin Australia.
Speaking on which, Vaughan Strawbridge, Head of Deloitte for Virgin Australia's sale said that the shortlisting the two final bidders who already granted approval from the Foreign Investment Review Board, marked a pivotal milestone in the final process.
As the ongoing COVID-19 pandemic has significantly impacted the travel industry in Australia, the airline went into administration around 3 months ago, owing about $7 billion to several creditors. The selling process would help the airline to reduce debt. The new airline will primarily focus on the domestic markets in Australia and operate fewer routes.