Brazil's struggling airline Viacao Aerea Rio-Grandense SA, or Varig, said Thursday it paid $56 million to U.S. aircraft leasing companies and won an extension of its bankruptcy protection.

A New York court extended protection to Varig until March 17, when Judge Robert Drain will assess the progress of the company's restructuring plan, Varig said in a statement.

The company will present the plan to creditors on Jan. 31, Varig said.

Burdened with debts of more than 7 billion reals ($3.1 billion), Varig sought local bankruptcy court protection in June. But leasing companies filed separate cases in New York.

Varig raised money by selling its cargo unit VarigLog to the U.S.-based fund Matlin Patterson. On Thursday, the airline announced the sale of its maintenance subsidiary VEM to the Portuguese airline TAP for $72.2 million.

Varig remains the dominant Brazilian carrier on the international market but has fallen behind TAM Linhas Aereas SA and the no-frills airline Gol Linhas Aereas Inteligentes SA on the domestic market.