As the first major step in its restructuring, Varig is nearing a decision on which of seven investment bids to accept. After choosing a new financier, Varig plans to file for bankruptcy court protection. That option only became available by a recent amendment to Brazil's bankruptcy law, effective during April, that allows an airline to continue operating while under court protection. Varig's debts exceed $2 billion, but it hopes to offset much of that with a large judgement it holds against Brazil's federal government. None of the investment bidders have offered to assume Varig's debts.
Source: Airline Business
