Air Baltic has entered Chapter 11 creditor protection in New York after securing €350 million in debtor-in-possession financing to keep flights, bookings and reservations operating through the restructuring. The Latvian carrier filed in the Southern District of New York as it seeks court supervision over a debt-heavy balance sheet and a more sustainable capital structure.
The financing package is backed by lenders including Strategic Value Partners, Barclays, Hayfin Capital Management, Morgan Stanley and Oaktree Capital Management, with court approval needed before the funds can be drawn. Air Baltic expects the process to run until around June 2027, giving it time to renegotiate obligations with aircraft lessors and other creditors while maintaining service.
The move places one of Europe’s most closely watched regional airlines under a formal US insolvency framework, while day-to-day operations continue. The funding is reported to carry interest of roughly 12%, underlining the cost of supporting the carrier through the restructuring period.