Avantair Unveils Details of ‘Go-forward’ Plan
07-09-2013, 02:40 PM
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Avantair Unveils Details of ‘Go-forward’ Plan
Avantair Unveils Details of ‘Go-forward’ Plan
AINALERTS » JULY 9, 2013
by CHAD TRAUTVETTER
Avantair ceased operations in late June, seeking new financing. If it implements its ‘go-forward plan’ the company expects it could resume operations early next month. (Photo: Matt Thurber)
July 9, 2013, 3:35 PM
On Wednesday, Avantair sent out its “go-forward plan” for “NewCo,” the working name for a reborn Avantair, that would first seek to “restructure and stabilize the business” as a mostly East Coast-only fractional provider. Under the plan, the company’s debts would be wiped out, though the plan does not specify how that will be accomplished.
NewCo would also downsize employees to a “core group” and secure additional financing. NewCo would also need to retain at least 300 of the 620 fractional shareowners. Its fleet–currently at 56 airplanes–would be pared to 25 aircraft.
Those shareowners opting to stay with the new Avantair would have to pay a one-time assessment of $25,000 for a “catch-up maintenance fund” to bring the fleet to airworthy condition. Monthly management fees–which also include 1/12th of owners’ annual occupied time–would rise by nearly 40 percent, to $15,846.
The new Avantair would also need “$4.5 million in funding to finance Avantair’s restructuring process and permit NewCo to emerge with sufficient working capital.” In addition to this, Avanti manufacturer Piaggio Aero has pledged to provide a $1 million investment and another $1 million in credit facility on parts.
If it can attract the required number of customers and the necessary financing and shed its debt, the new Avantair–which will be rebranded–could start operations early next month, the plan says.
AINALERTS » JULY 9, 2013
by CHAD TRAUTVETTER
Avantair ceased operations in late June, seeking new financing. If it implements its ‘go-forward plan’ the company expects it could resume operations early next month. (Photo: Matt Thurber)
July 9, 2013, 3:35 PM
On Wednesday, Avantair sent out its “go-forward plan” for “NewCo,” the working name for a reborn Avantair, that would first seek to “restructure and stabilize the business” as a mostly East Coast-only fractional provider. Under the plan, the company’s debts would be wiped out, though the plan does not specify how that will be accomplished.
NewCo would also downsize employees to a “core group” and secure additional financing. NewCo would also need to retain at least 300 of the 620 fractional shareowners. Its fleet–currently at 56 airplanes–would be pared to 25 aircraft.
Those shareowners opting to stay with the new Avantair would have to pay a one-time assessment of $25,000 for a “catch-up maintenance fund” to bring the fleet to airworthy condition. Monthly management fees–which also include 1/12th of owners’ annual occupied time–would rise by nearly 40 percent, to $15,846.
The new Avantair would also need “$4.5 million in funding to finance Avantair’s restructuring process and permit NewCo to emerge with sufficient working capital.” In addition to this, Avanti manufacturer Piaggio Aero has pledged to provide a $1 million investment and another $1 million in credit facility on parts.
If it can attract the required number of customers and the necessary financing and shed its debt, the new Avantair–which will be rebranded–could start operations early next month, the plan says.
07-09-2013, 06:43 PM
#4
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Joined APC: Aug 2007
Posts: 436
It sounds like they are attempting a quickie, GM-style bankruptcy: The old company sells assets to the new company, and the old company goes chapter 7 as quickly as possible. Of course, they would need a court's permission to dump the liabilities - and some of those 620 owners might object to getting tossed out with no chance to recover much.
And the new company has no employees or former employees, so they can do whatever they want in terms of hiring and paying pilots.
And the new company has no employees or former employees, so they can do whatever they want in terms of hiring and paying pilots.
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