The Latvian airline Air Baltic requested creditor protection in a New York court under US bankruptcy law, specifically Chapter 11, to restructure its financial obligations and achieve a more sustainable capital structure. The carrier, owned by the Latvian State with 88.37% and the German group Lufthansa with 10%, assured that the process will not affect passengers and that operations will continue normally.
The Chairman of Air Baltic's Supervisory Board, Andrejs Martinovs, emphasized that the company carefully evaluated the available restructuring options, with the priority of providing the airline with "the best possible basis to continue operating and build a sustainable financial structure." The company's CEO, Erno Hildén, added that they are implementing "the necessary measures to make Air Baltic a more efficient and financially sustainable airline."
Air Baltic enters the process with a commitment of 350 million euros in new financing, managed by Strategic Value Partners, with Barclays, Hayfin Capital Management, Morgan Stanley and Oaktree Capital Management as creditors. This new financing will carry an interest rate of 12 percent and, together with cash generated from ongoing operations, should provide sufficient liquidity for the company to continue operating during the restructuring proceedings.
The Latvian Prime Minister, Andris Kulbergs, commented on social media X that this time it is not about "buying a few more months to artificially keep the airline alive," but rather about "starting to address the underlying problems." Air Baltic noted that this type of process has previously been used by other international airlines, including SAS, United Airlines, Delta Air Lines, GOL and American Airlines.
