Richard Branson’s Virgin Atlantic Airways Ltd. filed for Chapter 15 bankruptcy protection in the U.S. on Tuesday after telling a London court it was set to run out of cash next month if a pending rescue deal isn’t approved.
The airline filed its petition in the Southern District of New York. Chapter 15 allows foreign companies with U.S. assets to protect themselves against claims while they work on a turnaround plan at home.
The company had said during proceedings in the U.K. that it planned to apply for the U.S. protection while it finalizes a rescue plan that’s already supported by a majority of its stakeholders. Virgin is seeking to secure a £1.2 billion (¥165.7 billion) rescue, which was announced in July.