Indonesia's Mandala Airlines Suspends Flights Over Debt Problems

Jakarta Globe, January 12, 2011          

Indonesia's PT Mandala Airlines, a national budget carrier, will suspend flights from Wednesday as the company struggles with debt problems, President Director Diono Nurjadin told a news conference.

Budget carrier Mandala Airlines will be suspending flights
 starting on Wednesday, it announced. (JG Photo /
Jurnasyanto Sukarno)   

"We think this is the best step to guard the future prospects of Mandala," he said.

"Starting tomorrow we will stop operations temporarily to be able to focus on restructuring the company."

He said the company had asked the commercial court to delay debt recovery action against the airline, also saying that Mandala had received interest from buyers for a stake.

On its Web site, www.madalaair.com, the following message was posted: “Mandala Airlines will cease all operations from Thu 13 Jan 2011 to initiate a business restructuring. No flights will operate from 06:00 (local time) and you are advised to make alternative travel arrangements on another airline.

“Please contact our service center or email us at (EMAIL ADDRESS) with your reservation number so we can initiate the the refund process.

We apologize for the inconvenience caused to you as a result of this action. We are trying our best to address the situation and ask for your understanding and support. The Mandala Team.”

Reuters, JG