airBaltic wins court approval to keep flying during Chapter 11

A US bankruptcy court has approved airBaltic's initial requests linked to its voluntary Chapter 11 filing, so the Latvian airline can keep flying while it restructures its finances.

The court also let the carrier draw an initial €140 million from a €350 million debtor-in-possession financing package. The remaining funds will be released in stages, depending on the facility's terms and, where needed, further court approval.

That means airBaltic can keep to its flight schedule, pay staff and suppliers, and honour tickets, bookings, refunds, vouchers and loyalty points customers already hold. Passengers with upcoming trips need do nothing, the airline said.

Strategic Value Partners arranged the financing. Barclays, Hayfin Capital Management, Morgan Stanley, Oaktree Capital Management and Strategic Value Partners are backing it. Along with revenue from day-to-day operations, the facility is meant to fund the airline for the whole court-supervised process.

airBaltic said the reorganisation aims to give it a stronger balance sheet and lower cost base. Chief executive Erno Hildén said the airline would keep flying and serving passengers as usual while it talks with creditors and other stakeholders.