(Reuters) – Slovenian airline Adria Airways has filed for bankruptcy and canceled all flights, it said in a statement on Monday, after financial problems forced it to ground most of its planes over the last week.

“Bankruptcy proceedings were initiated by the management of the company because of the company’s insolvency,” Adria, which is owned by German investment firm 4K Invest, said.

Adria is the latest in a long line of small European airlines to run into financial trouble amid industry overcapacity, cut-throat competition and high fuel prices.

Since last Tuesday Adria has canceled more than 400 flights affecting more than 15,000 passengers.

Slovenia’s Economy Minister Zdravko Pocivalsek said earlier on Monday the government was considering establishing a new airline company to improve the country’s international connections. Adria’s collapse was very damaging to Slovenia’s economy and tourism industry, the minister said.

Officials were talking to Germany’s Lufthansa (LHAG.DE) and Fraport (FRAG.DE), which owns Ljubljana airport, about transferring half of Adria’s flights, Pocivalsek said.

A Lufthansa spokesman said it was too early to say how Adria’s flights would be replaced in the long-term. Lufthansa is currently organizing flights to cover connections Adria was flying for the German group, either exclusively or via code share, he added.

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