Russia’s Transaero Airlines has been declared bankrupt

Transaero has been declared bankrupt by the Commercial Court of St. Petersburg and Leningrad Region. Bankruptcy proceedings have been initiated for a period of six months. In March, 2015 the airline was unable to pay debts which had accumulated to the level of 77 billion rubles (approximately US$1.1 billion). Plans for Aeroflot to take over 75% of the ailing airline for a nominal sum of 1 ruble failed to materialise later that year, by which the carrier’s debts had risen to nearly 250 million rubles (US$4 billion). In September 2015, S7 Airlines, one of Transaero’s Russian competitors failed to follow through with an offer to buy a 50% stake in the airline, subsequent to which Russian authorities revoked its air operating certificate, transferring its traffic rights to other airlines. In October 2015 Sberbank and Alfa Bank filed bankruptcy petitions against the troubled airline, after which the Commercial Court of St. Petersburg and Leningrad Region initiated bankruptcy procedure against Transaero on December 16.
Transaero filed an application with the Commercial Court of St. Petersburg and Leningrad Region on November 17, 2016, seeking to drop the case. Transaero managers submitted the company’s business resumption plan and the carrier’s management, headed by Director General Alexander Burdin, presented alternatives which could make it possible to return money to creditors via relaunching the airline on the base of its assets.