Avantair Plots Forward Plan, but Are Clients on Board?

AINalerts » July 2, 2013
July 2, 2013, 3:35 PM

On Friday, Avantair president and COO David Haslett updated customers on the current status at the shut down fractional provider and said that a plan to resuscitate the Clearwater, Fla.-based company is being developed. He also assured shareowners that their aircraft are still insured and “on the ground” at maintenance bases.

“Our business model assumed efficiencies that never materialized and a pricing schedule based on those efficiencies,” he said. “Over the past few months, we encountered issues that drained the company’s working capital. As our service was impacted and we were forced to ground our fleet temporarily, charter costs skyrocketed and our accounts receivable grew as it became increasingly difficult to collect on outstanding amounts due. It is apparent that Avantair must restructure.”

In addition to restructuring the balance sheet, Avantair plans to revise its pricing to ensure “profitable operations” in the future, he noted. “Over the next several days, the company will be validating the fees we charge and a new business model will be presented to the owner group.”

Avantair is currently in discussions with vendors, lenders and other third parties to obtain the working capital needed to restructure and fund operations going forward, Haslett said. It also needs to win over its share owners, a daunting task given its difficulty in providing reliable service over the past nine months.

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Douglas E Carper
on July 2, 2013 - 7:42pm

It is simply too late for trying to fix Avantair with a few tweaks...Instead, chapter 11 is the more logical step and an order liquidation of the owner's airplanes. Once in bankruptcy, some serious legal questions will need to be answered as to "borrowing" parts from other's airplanes...hmm, and never returning them. In the end, there were just a handful of air-worthy aircraft with the vast majority of aircraft spread out all over the country at various airports/FBO's in what must be described as horrible condition. It is a sad story...it gets worse the more you learn.

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david
on July 2, 2013 - 10:40pm

The employees are also sueing the company. Santos is a crook...

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Tom
on July 5, 2013 - 12:35pm

That's what u get when you operate 35% lower than you should. The CEO takes over 1 million a year and the pilots are paid crap. I'm glad it failed, it was unsafe.

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Elementary Etique Society
on July 8, 2013 - 2:18pm

It's a shame when the owners finally find their plane what some will see. You might as call some of the P.180s Seashells. Because that is about what you will find a shell of a aircraft.

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Innocent
on July 13, 2013 - 9:26am

The employees were not paid the wages due on 6/28/13. They were informed that was the case on 6/26. Management let them work 5 days into the new pay period. HSAs (health saving acct) held by an outside firm were closed and the money sent back to management. Class action suit filed by employees for wages. Class action and individual suits filed by fractional owners. Shares sold on aircraft long since stripped of all parts. Fraud alledged. Parts including engines swapped btwn aircraft to the extent that tracking not possible due to negligent recordkeeping. Ongoing federal investigation (DOT-OIG) into possible management interference with accident reporting. Ongoing investigation (DOT and DOJ) into SEC issues and fraud allegations.

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