Latvia's airBaltic voluntarily filed for Chapter 11 bankruptcy protection in New York on Monday as it seeks to restructure its debt and cope with soaring costs linked to the Iran war.
The airline secured a commitment for EUR 350 million in financing from lenders including Strategic Value Partners, Barclays, Hayfin Capital Management, Morgan Stanley and Oaktree Capital Management, subject to court approval.
The financing carries an interest rate of about 12%. AirBaltic, which has about $583 million in funded debt and finance lease liabilities, expects to complete the restructuring by June next year while maintaining scheduled flights.
The airline plans to defer or cancel some aircraft deliveries under its $3.5 billion order for 40 Airbus planes and reduce its wet-lease operations. CEO Erno Hilden said the company is also discussing workforce adjustments with unions as part of capacity reductions. AirBaltic employs more than 3,000 people and generated about €779 million in revenue in 2025.
Majority-owned by the Latvian government, the airline operates a fleet of about 50 Airbus A220-300 aircraft. Latvian Prime Minister Andris Kulbergs said Chapter 11 was one of the best options to preserve the airline's viability as it searches for a strategic investor.
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September 11, 2026 16:26 ET Consumer prices data was the main news on the economic front in the U.S. this week. In Europe, the latest interest rate decision from the European Central Bank was the focus along with the revised second quarter economic growth data for the euro area. In Asia, the monthly foreign trade data from China drew attention.