Air Berlin (1991) (Berlin Tegel) has announced it has filed for bankruptcy with the district court of Berlin Charlottenburg. It has requested the begin insolvency proceedings under self-administration to continue with its already initiated restructuring efforts.

According to the ailing carrier, the German federal government, Lufthansa (LH, Frankfurt International) and other partners are assisting it in its restructuring efforts. The government has thus far provided a guarantee for a EUR150 million euro bridge loan from the state-owned KfW Development Bank allowing the airline to continue flight operations for the time being.

Air Berlin is in negotiations with Lufthansa and "other partners" to sell parts of its business. These talks are said to be "well advanced and promising" and may be concluded shortly.

According to Germany's Bild newspaper, the prelude to the filing came when Air Berlin's largest shareholder, Etihad Airways (EY, Abu Dhabi International), notified it on Friday of last week that it no longer intended to provide it with financial support. On top of the EUR250 million disbursed in April this year, Air Berlin had expected a EUR50 million loan from the Emirati carrier to have been disbursed last week. When it was not, Air Berlin triggered the aforementioned insolvency proceedings.

"Air Berlin's business has deteriorated at an unprecedented pace, preventing it from overcoming its significant challenges and from implementing alternative strategic solutions," Etihad said in a separate statement. "Under these circumstances, as a minority shareholder, Etihad cannot offer funding that would further increase our financial exposure. We remain open to helping find a commercially viable solution for all parties."

Air Berlin has reiterated that all flights operated by itself and its Niki (Austria) (Vienna) unit will continue as planned with all bookings still valid. The Austrian production carrier is not part of the insolvency proceedings.