Following an announcement that US-based LCC Spirit Airlines has entered voluntary Chapter 11 bankruptcy proceedings, a court has ruled that the business can continue operating while restructuring takes place.

The U.S. Bankruptcy Court for the Southern District of New York has given approvals to enable Spirit to continue operating as usual, including honouring tickets, reservations, credits and loyalty points and paying wages and paying certain critical vendors and partners for goods and services delivered prior to the filing date. In addition, Spirit intends to pay vendors and suppliers for goods and services provided on or after the filing date in the ordinary course.

READ: Spirit Restructuring (external link)  

“We are pleased to have reached this first milestone in our restructuring process, which will support normal operations as we take decisive action to ensure that Spirit continues delivering the best value in the sky for years to come,” said Dave Davis, President and Chief Executive Officer. “With these approvals in place and access to the many new tools now available to us, we can continue to implement our transformation to build a stronger foundation and future for Spirit.”

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The court noted that Spirit currently has sufficient liquidity to fund its operations, and that it continues working productively with its secured noteholders and other stakeholders, including with respect to potential financing that may become necessary.