Colombian airline Avianca has filed for Chapter 11 bankruptcy in the U.S. Southern District of New York citing a drop of more than 80% in consolidated revenue as flights remain grounded due to the COVID-19 pandemic.

In a statement, the company said it would use the bankruptcy to balance its sheet obligations to navigate the effects of COVID-19 and to address liabilities, leases, aircraft orders, and other commitments. The company also said it intends to wind-down its operations in Peru.

In a research report, analysts at the Centre for Aviation said Avianca was in a “period of upheaval” even before the global health crisis. In April 2019, CEO Hernan Rincon Lema announced he was leaving the company after three years in the role.

The company also saw a series of negative credit ratings and a sudden change in board control. Last year, the company announced the “Avianca 2021” plan under which it reprofiled its debt and lease obligations. It also raised $375 million in new financing.

“Avianca is facing the most challenging crisis in our 100-year history as we navigate the effects of the COVID-19 pandemic,” chief executive officer Anko van der Werff said. “Despite the positive results yielded by our Avianca 2021 plan, we believe that, in the face of a complete grounding of our passenger fleet and a recovery that will be gradual, entering into this process is a necessary step to address our financial challenges.”

Avianca said it has “limited visibility” on when travel restrictions would be lifted and it expected the effects of the pandemic on travel to be long-lasting.

Avianca, founded in 1919, was the third-largest airline in Latin America based on market share at the end of last year, according to Euromonitor.

Luiz Souza/NurPhoto via Getty Images

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