[REVISION HISTORY]

AirBaltic restructuring and state stabilization efforts

Updated 24 times since CLSTR started tracking revisions of this situation.

What changed

2026-09-09 06:46 UTC → 2026-09-11 06:12 UTC · added ~~removed~~

AirBaltic is undergoing a major financial and operational restructuring to avoid insolvency. To prioritize stability, the airline is reducing its Airbus A220-300 fleet from 54 to approximately 36 aircraft by the end of 2026, with a long-term target of 40 by 2031. This shift, driven by geopolitical instability, rising costs, and engine supply issues, has drawn criticism from the Latvian Aviation Trade Union, which warns of potential staff reductions of 20% to 30%. To manage liquidity, the airline is seeking approximately €225 million in interim financing and €100 million in new equity. Bondholders have approved a plan to capitalize €380 million in interest payments, deferring bond repayments until 2029. In September 2026, the ~~airline reached an agreement for bridge financing~~ Latvian Cabinet of ~~up to €257 million with existing bondholders and third-party providers.~~ Ministers approved the continuation of the financial stabilization process. While the ~~airline’s~~ government supports the process, it has not yet decided on providing temporary state funding, noting such involvement would be considered separately. The Ministry of Transport stated this decision provides a basis for implementing a new business plan and managing relations with shareholders and bondholders. Board ~~Chairman,~~ Chairman Andrejs ~~Martinovs,~~ Martinovs confirmed the company is focusing on its business plan rather than insolvency or legal protection, the Latvian Cabinet of Ministers has approved the continuation of the financial stabilization process. The government noted that any temporary state funding would be considered separately. Political debate continues regarding noting the ~~airline’s recovery. Latvian Economy Minister and ZZS Prime Ministerial candidate Viktors Valainis~~ airline has ~~urged Lufthansa, which holds~~ engaged Seabury Securities LLC as a ~~10% stake,~~ specialist consultant. To secure liquidity, the airline is seeking approval for up to ~~take a more active role~~ €257 million in emergency bridge financing ~~and management rather than remaining~~ through the issuance of new super-senior bonds maturing in February 2027. This financing carries a ~~“passive observer.” Valainis also expressed opposition~~ high annual interest rate of 25%. The deal involves London-based Polus Capital Management and Israel-based Klirmark Capital 4, with Polus committing to subscribe to at least half of the ~~government’s proposed stabilization solution, suggesting~~ new bonds. Analysts have described the ~~state should facilitate negotiations between creditors and investors instead of providing direct funds.~~ facility as a “costly method to secure necessary liquidity.”

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