AirBaltic Files for Chapter 11 Bankruptcy Protection in New York

Post by : Saif

AirBaltic, Latvia’s national airline, has filed for protection under Chapter 11 of the U.S. Bankruptcy Code in New York as it begins a financial restructuring aimed at reducing its debt.

The airline said the court-supervised process will allow it to reorganize its finances while continuing normal operations. AirBaltic is majority-owned by the Latvian government.

AirBaltic Flights to Continue

AirBaltic said passengers should not expect immediate disruption from the Chapter 11 filing. Flights will continue according to their existing schedules, while tickets and reservations will remain valid.

Customer service operations are also expected to continue without interruption during the restructuring process.

The airline emphasized that the bankruptcy protection is part of a financial restructuring rather than an immediate shutdown of its operations.

€350 Million Financing Secured

AirBaltic has secured a commitment for €350 million, or about $405 million, in debtor-in-possession financing.

The funding is designed to provide the airline with enough liquidity to continue operating while it works through the restructuring process.

Lenders involved in the financing commitment include Strategic Value Partners, Barclays, Hayfin Capital Management, Morgan Stanley and Oaktree Capital Management.

Debt Reduction at the Centre of Restructuring

Reducing debt is a key objective of AirBaltic’s Chapter 11 process. The airline will use the U.S. court-supervised restructuring framework to address its financial obligations and strengthen its balance sheet.

Chapter 11 protection allows companies to reorganize their finances while continuing business operations under court supervision. For AirBaltic, the process is intended to provide financial stability while keeping its airline services running.

Latvia Remains Majority Owner

The Latvian government holds a majority stake in AirBaltic, making the airline an important part of the country’s aviation sector.

The restructuring will therefore be closely watched in Latvia, particularly because AirBaltic plays a significant role in connecting the Baltic region with European destinations and other international markets.

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What AirBaltic’s Bankruptcy Filing Means for Passengers

For passengers, the immediate impact is expected to be limited. Existing flights are scheduled to operate, and current tickets and reservations remain valid.

The financing commitment also provides the airline with additional funds to maintain operations during the restructuring.

AirBaltic’s Chapter 11 filing marks a significant financial step for the airline, but the company says its focus remains on continuing flights and customer services while working to reduce debt and improve its financial position.

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