ONE Aviation files for Chapter 11 bankruptcy protection


Eclipse EA700

ONE Aviation has filed for Chapter 11 bankruptcy in the US courts, saying that it already has a pre-packaged plan of reorganisation. That plan is to be presented to a court in Delaware on November 19.

ONE Aviation was formed in 2015 through the merger of Eclipse Aerospace and Kestral Aircraft. Eclipse made the Eclipse series of Very Light Jets (VLJs), whilst Kestral was in the process of bringing a single-engine turboprop to market.

The pre-packaged reorganisation plan includes a debt-for-equity swap, with Citiking International US LLC taking 100% of class A shares in the newly reorganised company. Citiking has already agreed to provide a $17 million post-petition credit facility so that ONE Aviation can continue to pay its debtors.

In its court filing, ONE Aviation says that it contracted Guggenheim Partners in early 2017 to try to find a buyer for the company. But although two interested parties came forward, Guggenheim did not receive any viable bids for the company.

At the same time as Guggenheim were seeking buyers for the company, ONE Aviation also hired Guotai Junan Securities USA, Inc to act as its exclusive agent in mainland China to assist in its recapitalisation efforts.

As nobody came forward in China or the US, nobody came forward , the company contracted Duff & Phelps to seek a new buyer, this time offering the in Chapter 11. A total of 41 companies signed non-disclosure agreements to receive more information on the sale, however nobody progressed further into sale negotiations.
ONE Aviation officially entered Chapter 11 on October 10, with total debt of $198,801,602.

As of June 2018, the company says that it had assets with a book value of $222 million, with liabilities totalling $256 million. The order book, the amount of aircraft that have been ordered but not yet delivered, stood at 15 aircraft at the end of September 2015. ONE Aviation says that it currently holds $1.5 million in escrow as deposits for aircraft.

Should the restructuring plan be approved, the newly organised ONE Aviation believes that it could be delivering 50 aircraft per year by 2024.

The company is currently working on an updated version of its Eclipse 550 called the Eclipse 700.

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