Ravn Air Group conditionally approved to seek grants under CARES Act
The U.S. Treasury has approved Ravn Air Group’s ability to seek payroll grants under the CARES Act Payroll Support Program, which will enable interested buyers of the group to preserve the airline.
The Air Group filed for Chapter 11 protection on April 5 due to a 90% drop in bookings because of the COVID-19 pandemic. Ravn was the largest regional air carrier in the state with over 1,300 employees and flights to 115 locations.
The approval to seek assistance means a potential buyer could maximize creditor recoveries and exit the Chapter 11 protection, according to a statement from Ravn Air Group. Ravn is now working with its debtor in possession lenders on a plan to sell all assets by June 17, which Ravn will request to be approved by a federal bankruptcy judge handling the Chapter 11 case.
“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 Ravn’s President and CEO Dave 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.”
The airline flew to more remote destinations in Alaska including the City of Saint Paul in the Aleutians West Census Area.
“Ravn provides vital air service to our remote island community, and they have been a fantastic partner over the last year and a half,” City Manager for the City of Saint Paul, Phillip Zavadil, said in a prepared statement.
Ravn has motioned to authorize the sales bidding procedure, and if approved on May 27, bids will be due by June 17.