Brazil's embattled flagship passenger airline, Varig, has been in a constant struggle to ward off total collapse as it canceled flights, saw many pilots leave for other carriers and fought creditor attempts to seize much of its fleet. But it appears to have a reprieve.

A Brazilian bankruptcy judge cleared the way for an employees group known as TGV to buy Varig for $449 million. He gave the group a short deadline to make its initial payment.

Varig has fallen hard in recent years. In 2004 it had been just behind Air Canada to rank 34th among the world's largest cargo airlines, its 1.231 million freight tonne kilometers ahead of U.S. passenger airline Continental Airlines and cargo carrier ABX Air.

But with a high debt load it went into bankruptcy in 2005, and while it remained the country's leading international airline its domestic market share slipped rapidly and this year it was scrambling for enough cash to keep flying at all.

By this week some wondered if it could operate long enough to bring its star soccer team and thousands of Brazilian fans back from the World Cup games in Germany, or might just leave them stranded. Reports said the government began making alternative plans to retrieve the passengers, in case Varig shut down.

Meanwhile, even with the sale decision and pending cash payment, Varig still faced the possible loss of dozens of its 46 operating planes, including some widebody MD11 passenger jets that are much in demand by cargo carriers wanting conversion freighters of that cost-effective model.

A bankruptcy judge in New York ordered Varig to return nine aircraft to International Lease Finance Corp., but blocked the seizure of 25 others. He planned to rule June 21 on whether Varig had to return 25 more to their U.S. owners, including Boeing Capital, or whether he might extend his order blocking that action.

John D. Boyd