IAero Group Parent LLC - the parent of charter carrier iAero Airways (WQ, Greensboro Piedmont Triad International), maintenance firm iAero Tech, lessor iAero Thrust and 13 other affiliated debtors - has applied for permission to be sold via bankruptcy auction in early December at a minimum purchase price of USD216.3 million, failing which a restructuring plan will be submitted, according to court filings.

The Group filed for voluntary Chapter 11 bankruptcy protection in the US Bankruptcy Court of the Southern District of Florida (Miami Division) on September 19 but continues operations with senior lenders agreeing to debtor-in-possession (DIP) financing of about USD22.5 million.

A hearing in the Miami court was scheduled for October 16 to consider an expedited motion filed by iAero Tech on October 3 for an order to prepare an auction as soon as possible and approve bidding procedures for the sale of the debtors' assets.

It proposed December 1 as the final bid deadline, with the auction to take place on December 6, with December 13 set down for a hearing to approve the proposed sale.

Any qualified bid would have to comprise a minimum cash offer of USD216,294,059, including USD89,554,247 covering claims by aircraft financier Synovus and pre-petition Synovus aircraft term loan claims.

According to a preliminary statement, the debtors entered into a restructuring support agreement (RSA) with their respective secured lenders before they filed for Chapter 11 protection. The RSA contemplates two potential restructuring scenarios to be pursued simultaneously:

  • the sale of all, or substantially all or a subset of the debtors' assets in a single bid from a single bidder or multiple offers from multiple bidders;
  • a reorganisation scenario will see the debtors seeking confirmation of a reorganisation plan under which certain lenders will exchange a portion of their debt for equity in the reorganised companies and receive new secured claims. Said scenario would happen only if the auction scenario does not yield one or more qualified bids.