(Reuters) – Thailand’s cabinet approved a plan to restructure troubled Thai Airways International Pcl’s (THAI.BK) finances through a bankruptcy court, the Southeast Asian country’s prime minister said on Tuesday.

The plan for a court-led restructuring of the national carrier replaces a previous proposal of a government-backed rescue package that was heavily criticised in the country.

The airline’s troubles are the latest example of how the coronavirus pandemic is crippling the global airline industry.

Colombia’s Avianca Holdings SA AVT_p.CN and Virgin Australia Holdings Ltd (VAH.AX) have filed for bankruptcy protection since the pandemic broke out.

Thai Airways, though, had been in trouble even before the outbreak of the coronavirus due to stiff competition from budget airlines and bloated costs.

It posted losses every year after 2012, except in 2016. In 2019, it reported losses of 12.04 billion baht ($377.3 million).

“We have decided to petition for restructuring and not let Thai Airways go bankrupt. The airline will continue to operate,” Prime Minister Prayuth Chan-ocha told reporters at a news briefing.

If the request is accepted by the bankruptcy court, Thai Airways would be given an automatic stay restricting legal action from creditors.

“The Cabinet also agreed the government will reduce its holding in Thai Airways to under 50%, ending the airline’s status as a state-enterprise”, Transport Minister Saksayam Chidchob told reporters.

Thai Airways said the plan will be implemented through the Central Bankruptcy Court and it would operate as usual as the restructuring took place.

“Thai Airways will not be dissolved or go into liquidation or be declared bankrupt,” Thai Airways Acting President Chakkrit Parapuntakul said in a statement.

Operations including passenger and cargo transportation will continue in parallel with the plan, he said.

Thai Airways shares surged 16.6% on Tuesday, but are still down by about a third this year.

SOURCE REUTERS