Avantair announces plan to resume operations
Troubled airline Avantair, expects to resume flights in early August, pending new financing. On Wednesday, July 17, the airline announced it’s “go-forward” plan for continuing operations. The go-forward plan included a change in name to “NewCo.”
The plan states that all current debt will be wiped out going forward, but does not state how that will be done. NewCo also plans to downsize employees to a “core group” and will get rid of over half of their current fleet of 56 airplanes and resume operation with just 25 planes.
NewCo hopes to retain at least 300 of their current 620 shareholders to remain operational. Those who intend to stay will be required to pay a one-time fee of $25,000 that will be deposited into a “catch-up maintenance fund” which will be used to fund necessary repairs that will make the fleet airworthy. Shareholders will also be expected to pay 40 percent more a month in management fees for a total of $15,846.
For the “go-forward” plan to work, Avantair needs to garner $4.5 million in funding to finance their restructuring process and permit NewCo to have working capital.
Piaggio Aero, the manufacturer of Avantair aircrafts, has pledged to provide a $1 million investment and another $1 million in credit facility parts.
Before furloughs, Avantair employed 500 people and operated out of St. Pere-Clearwater International Airport in Clearwater, Fla. Upon furloughing employees, the company owed its employees wages from June 8 until June 26. It is unclear as to whether those wages were ever paid to employees. Avantair dropped employee healthcare, dental and vision plans for the workforce effective July 1.
Avantair pilots voted for SMART representation in February of this year, just a few months before Avantair shut down operations. The new local did not yet have an agreed-upon contract in effect when Avantair furloughed all employees June 26.