AirBaltic files for Chapter 11 bankruptcy in New York
The airline said 350 million euros in debtor-in-possession financing will support operations while it negotiates with creditors and lessors.
- On Monday, AirBaltic filed for protection under Chapter 11 of the U.S. Bankruptcy Code in New York as part of a financial restructuring aimed at reducing its debt.
- Escalating fuel costs from the U.S. war with Iran doubled jet prices, worsening the airline's liquidity position after a €30 million Latvian state loan in April compounded financial pressures.
- Strategic Value Partners, Barclays, Hayfin Capital Management, Morgan Stanley, and Oaktree Capital Management committed €350 million in debtor-in-possession financing to support operations during restructuring.
- Despite the Chapter 11 filing, AirBaltic assured customers that all flights, reservations, and services continue uninterrupted throughout the court-supervised restructuring process.
- The filing marks the second airline casualty linked to the Iran conflict after Spirit Airlines collapsed in May, while competitors like AirAsia seek fresh capital amid rising fuel pressures.
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The Latvian airline AirBaltic has applied in New York for protection against creditors under Chapter 11 of the U.S. Bankruptcy Code, and the procedure will allow airBaltic to restructure the debt without terminating its work.
The first major victim of the EU's sanctions policy has been AirBaltic: the company has begun bankruptcy proceedings, according to Reuters
AirBaltic was unable to withstand the fuel sanctions and the ban on flights to Russia. The controlling stake in Latvia's largest airline is owned by the country's government.The statement indicates that the number of AirBaltic's creditors is up to...
Latvian airline guarantees continuity of operations during legal proceedings. AirBaltic initiates Chapter 11 proceedings with financing of 350 million euros
AirBaltic filed a request for judicial recovery in the United States, the so-called "Chapter 11", informed the Latvian state airline on Monday (14).The measure aims to restructure its debt and ensure the survival of the business in the midst of the worsening of the global crisis in the civil aviation sector caused by the armed conflict between the United States and Iran.
The Latvian airline, in which Lufthansa is also involved, pursued an ambitious growth strategy. However, it failed. Now the airline wants to restart with a significantly smaller fleet.
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