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Brightline, the privately operated high-speed rail network that connects South Florida to Orlando, is reportedly preparing to file for Chapter 11 bankruptcy protection. According to a recent Bloomberg report, the filing could happen as early as this week as the company works to restructure massive amounts of corporate debt.
Related – A New Brightline Station Is Officially Coming to Cocoa Thanks to Huge Federal Deal
Will the Trains Stop Running?
If you have an upcoming trip booked to the Orlando International Airport (MCO) to visit Walt Disney World or Universal Orlando, do not panic!
According to reports, the potential Chapter 11 filing would specifically exclude Brightline’s operating unit. This means that daily passenger train service between Miami, Orlando, and all the stops in between will continue to run normally without the appointment of a federal trustee. Your travel plans and tickets are safe while the company sorts out its financials behind closed doors.
Why is Brightline Filing for Bankruptcy?
Building a brand new, 235-mile high-speed rail system across the state of Florida is incredibly expensive. While Brightline’s ridership numbers are actually quite strong—seeing a 16% increase in passengers earlier this year compared to the same time last year—the ticket sales simply are not enough to cover the massive interest payments on the debt taken out to build the rail network.
The current restructuring effort will focus on approximately $1.1 billion of corporate debt. To ensure the trains keep running smoothly during the Chapter 11 process, Brightline has reportedly finalized a bankruptcy-financing agreement that includes at least $350 million in new loans to fund continued daily operations.
While Brightline has not publicly confirmed the exact date of the filing, discussions with hedge funds and bondholders remain ongoing. We will keep you updated as this story develops!
