A BUDGET airline has gone out of business after failing to attract any possible buyers at a bankruptcy auction.
Beleaguered Silver Airways had been fighting for survival after filing for bankruptcy in December last year.
Silver Airways has gone out of business after failing to attract potential buyersAlamy GettyTravelers have been told to avoid going to the airport[/caption]But, the low-cost carrier is to stop trading and travelers have been urged to avoid going to the airport, as per the CBS affiliate WTSP-TV.
A bankruptcy auction was held earlier this week, but no potential buyers stepped forward.
Chiefs had been struggling to clear mounting debts for months and the company had only eight turboprop planes as part of its fleet.
In a letter to customers, Silver Airways bosses had stressed the company would continue operating as normal.
“Our team remains committed to delivering the safe, comfortable, and reliable travel experience you deserve—whether you’re flying for business, reuniting with loved ones, or taking a well-earned beach getaway,” they said.
“We deeply appreciate your trust and loyalty to Silver Airways. Thank you for choosing us to meet your travel needs.
“We look forward to welcoming you aboard in the new year.”
How does bankruptcy work?
Bankruptcy is a specific legal process that helps companies eliminate debt they can't repay.
The process allows businesses to start fresh and gain access to new credit.
Supervised by federal courts, bankruptcies allow a company to sell off its assets more easily to pay off creditors, according to Investopedia.
Chapter 11, a common process for companies, is used to restructure a business with the goal of remaining open – even if it means selling off most of the company’s properties.
Chapter 7, on the other hand, sells all of a company’s assets, putting it out of business.
Chapter 15, alternatively, allows for collaboration between American and foreign courts to conduct bankruptcy proceedings with “parties of interest involving more than one country,” per the United States Courts.
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