Belgium-based VLM Airlines filed for bankruptcy protection in an Antwerp commercial court.
The move, if approved, would grant the airline operator creditor protection for a period of six months, enabling it to restructure operations.
According to VLM’s CEO Hamish Davidson, the company expected that the judicial reorganization would enable it to repay historical debts and suppliers and ensure the smooth running of daily operations.
KBC Bank’s decision to freeze VLM’s accounts on Wednesday last week triggered the filing, equivalent to Chapter 11 in the United States.
The airline’s debts reportedly included €3m ($3.4m) owed to the bank as well as an additional €3m owed to various suppliers which include the Antwerp Airport.
The operator had suffered a €13m ($14.7m) loss for its last financial year making it abandon plans to lease four SSJ 100-95 LRs from Russian lessor, the Ilyushin Finance Co., earlier this year.
At present, VLM operates eleven Fokker 50s (of which two are leased to each of Cityjet and flybe) on passenger charter flights as well as scheduled passenger flights between Belgium, Switzerland, Germany, the United Kingdom, Ireland, the Netherlands, Italy, and Norway.