Chapter 11 in the US allows protection from creditors insitsing on the business paying outstanding debts: which can force a bankrupcy. If there is a viable business to be rescued, turning and burning to get through an insolvency is better than a bankrupcy. If not, it's just delaying the inevitable.
@Torquetalk >> absolutely - and US Chapter 11 is similar to UK "Administration" where there is the expectation of coming out the other side "leaner and meaner" than before. In practice there is usually brief halt to get the paperwork done to establish (eg) who is now the signatory authority on contracts etc. I've seen a 50-year-old family business be forced into that UK system at close hand. In official legal wording, "
bankruptcy" in the UK can only be linked to persons, not companies.