US Court Approves airBaltic Chapter 11 Bankruptcy Filing and Restructuring Plan
Overview of airBaltic's Chapter 11 Bankruptcy and Restructuring
US Court Acceptance and Immediate Implications
Sept 16 (Reuters) - A U.S. court judge has accepted Latvian carrier airBaltic's request to enter Chapter 11 under the U.S. bankruptcy code and restructure its debt, Prime Minister Andris Kulbergs said on Wednesday.
"This means that airBaltic will be able to: immediately access financing; begin the restructuring process; review obligations to creditors. Work continues," Kulbergs said in a post on social media X.
The airline did not immediately reply to a request for comment.
Background and Reasons for Filing
Ownership and Financial Pressures
AirBaltic, majority-owned by the Latvian government, voluntarily filed for protection under Chapter 11 on Monday as it seeks to cut its debt pile after the Iran war increased financial pressure.
Secured Financing
The company has said it secured a commitment for €350 million ($404.1 million) in financing from certain lenders, subject to court approval.
Next Steps in the Restructuring Process
Negotiations and Reorganisation Plan
In the coming months, airBaltic is expected to negotiate with bondholders, aircraft lessors and other creditors as it works toward a formal reorganisation plan, which will require separate court approval before the company can exit Chapter 11.
Timeline and Long-Term Business Plan
Expected Completion and Strategic Goals
The airline has said it aims to complete the process by around June 2027, with a reduced fleet and lower operating costs as part of its longer-term business plan.
($1 = 0.8661 euros)
(Reporting by Gianluca Lo Nostro; Editing by Stine Jacobsen and Terje Solsvik)
