Fly Jamaica Files for Bankruptcy Protection

Troubled airline Fly Jamaica is seeking protection from creditors as it tries to restructure and stay in business or explore other options, such as a sale, The Jamaica Gleaner reports.

According to the Jamaican newspaper, that filing for bankruptcy protection with the Office of Insolvency was done on October 29, Marlon Murdock, the agent for Fly Jamaica trustee Wilfred Baghaloo, was reportedly quoted to say.

The news report indicates that this move follows the unravelling of a nascent deal over the summer with a group of investors seeking to acquire the airline from founder Paul Reece.

Mr. Murdock told the Financial Gleaner that Fly Jamaica is preparing a proposal for creditors to vote on, which was preceded by a ‘Notice of Intention’ in the press.

So far, Fly Jamaica has presented a list of 259 creditors, who are owed US$21.86 million ($2.9 billion). Murdock says the current list is not exhaustive and that the trustee is still ­receiving claims from creditors not on the current roll. He is encouraging all creditors to come forward for a clear picture of the carrier’s indebtedness, the report reads in The Jamaica Gleaner.

Fly Jamaica has been grounded for just over two years. Since a plane incident in November 2017 when the lone operational Fly Jamaica airplane – a Boeing 757 en route to Toronto from Guyana – skidded off the runway as the pilot attempted an emergency landing at the Cheddi Jagan International Airport, the damaged plane has been languishing at a remote section of the airfield.

Prospective buyers of the airline, headed by French acquisition and diversified firm W&L SAS, initially said they planned to get the airline flying again by September, which appeared to be a long shot, given that approvals were needed from the Jamaica Civil Aviation Authority to achieve that goal, the Gleaner points out.