Ravn Air Group has been conditionally approved by the
U.S. Treasury to apply for payroll grants under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) Payroll Support Program.
The grants would help pave the way for buyers seeking to purchase the entire Air Group, which is early in its bankruptcy proceedings. It would help as the air group tries to exit Chapter 11, and keep the workforce paid during the transition.
Ravn plans to sell all or most of its assets on Wednesday, June 17.
“This is great news for our creditors, our employees, our customers, and for the 115 different communities we were serving before the COVID-19 Pandemic hit Alaska and forced our company to seek Chapter 11 protection. We would like to thank Treasury Secretary Mnuchin and Alaska’s congressional delegation, Senators Dan Sullivan and Lisa Murkowski, and Congressman Don Young for their tireless work in connection with this conditional approval,” said Dave Pflieger, Ravn’s President & CEO.
“The opportunity to receive CARES Act Grants and work with our DIP lenders on a sale process means there is a new path forward by which Ravn could resume operations later this summer,” said Pflieger.
“Now, instead of only one path, a planned liquidation, qualified parties who meet strict bidding criteria and guidelines will be able to buy the entire Air Group with all three of its airlines. This is a game-changer for our creditors, our employees, our customers, and the many communities we have served for decades,” he said.
Ravn filed for Chapter 11 protection on April 5, following a 90 percent drop in bookings and revenue due to the arrival of COVID-19 in Alaska, and a state-mandated travel ban. Before that, Ravn was Alaska’s largest regional air carrier. The company and its three separate airlines had over 1,300 employees, and carried passenger, mail, freight, and charter customers to more than 115 destinations throughout Alaska.
If Ravn’s motion to authorize and approve sales bidding procedures is approved at the upcoming May 27 hearing, bids will be due on June 17.
So getting money to pay debts, and so they can sell and make a profit. Socialism at its finest.
Greg,
Not if the Alaska legislature gets a crack at the $$ first. I doubt that will happen since Ravn appears to have bypassed them and gone straight to the feds. All citizens and small businesses should be able to do the same thing. The tyranny of the Alaskan house majority stinks. Their ‘job’ to disburse emergency funds to Alaskans stopped as soon as they got their hands on the money. They keep the emergency money and hand it out to their pets. Alaskans get screwed.
Remember in November.
Yep, they need to be permanently sent home.
Maybe AIDEA can run them. Call it “The Alaska Aviation Highway”.
No matter which company takes Ravn’s place it will be better for Alaskans. I used to think Penn Air was the worst airline in the history of Alaska aviation. Ravn proved me wrong. I say good riddance, and let’s move forward.
Ravn as a company was unresponsive to the needs of the communities I’ve lived in , in bush Alaska. Unless they had a customer that needed to fly to our hub to catch a larger Ravn flight into Anchorage, they refused to make the inter village hops this area depended on. Itinerant workers needing to get from village to village in our area, were put off, cancelled, or ignored when trying to book inter village hops.
When Ravn, in Anchorage ,let my entire years supply of meat thaw in their facility, they flew it on to Aniak, then blamed Aniak for ruining the order. I filed for reimbursement. I didn’t get a phone call or letter from Ravn….and not 1 cent of reimbursement. What I did get was a lot of silence and ignoring. A letter to the prsident of Ravn brought the same…nothing.
Ravn employees in Aniak were always helpful and courteous whether on the phone or face to face. The Ravn Company itself has been going from bad to worse …..very insulting to us here in the Yukon villages. In the past we’ve had great service from grops like Mark Air , Ute Air….but haven’t had a dependable, courteous carrier in many years.
How is this not a clear abuse of the CARE’s Payroll Support Program if they are selling most of their assets on June 17? How can they : refrain from conducting involuntary layoffs or furloughs, or reducing pay rates and benefits, of employees of the applicant and its subsidiaries (or, in the discretion of the Secretary of the Treasury, any affiliated entity) until September 30, 2020.
Also this issue: Insolvency. The Treasury Department may refuse to provide payroll support payments to applicants that have taken, or are currently evaluating, any action to commence a bankruptcy or insolvency filing in any applicable jurisdiction.
Ravn Air was poorly run. CEO took a trip to a bush village and was shocked to see the pilot load freight. It never was FijiAir, Dave!
A takeover purchase by a company with an actual clue would benefit Alaskans.
Make sure all employees’ pay is fulfilled with this loan first.
All Ravn employees were paid what they were owed in April. That was the first thing the bankruptcy court approved. That included PTO pay.
130 employees are still working to maintain buildings and aircraft. Those employees are also being paid.
I hope you are right. I know the payroll department was incredible incompetent in terms of logging hours sent to them, getting pay done correctly ( regular hours, OT pay, correct leave time, etc) for tens of employees at several stations I’m aware of. Based on that, it almost certainly was a far wider problem.
More than likely that was a symptom of poor cash flow. The kung flu panic was simply the final straw.
Comments are closed.