Alaska Seaplanes says it wants to buy PenAir and save the Southwest Alaska airline’s operating certificate, which it says could disappear in a few weeks.
PenAir is owned by RavnAir Group, which declared bankruptcy earlier this year amid the COVID-19 pandemic.
Juneau-based Alaska Seaplanes has put in an offer to buy PenAir’s Part 121 certificate from Ravn, which allows scheduled service to destinations like Dillingham in Bristol Bay, and Dutch Harbor in the Aleutian Islands.
Ravn’s management has been trying to secure investment and federal aid to keep the company alive. But Alaska Seaplanes co-owner Ken Craford says that’s not realistic, and the best way to maximize Ravn’s value is to sell off its assets in an orderly way.
“Ravn is dead. And any chance at resurrecting it has passed, and any attempt to do so is a fool’s errand,” he said.
The bid from Alaska Seaplanes is in collaboration with a Connecticut investment firm, Wexford Capital, that lost a previous bankruptcy auction for PenAir in 2018.
The operating certificate is PenAir’s primary asset at this point, Craford says, since the company leases its planes rather than owns them.
PenAir, like the rest of Ravn’s companies, has been grounded by the pandemic. And it needs to return its planes to the air by early June in order to keep its certificate from lapsing, Craford says.
The company has already received one extension from the federal government, and it’s not clear if it will be able to receive another, Craford says. If the certificate lapses, it will be much more expensive to resurrect the airline, he says.
“We have a very narrow window of opportunity here to have the Ravn bankruptcy end up being a pause, rather than a full stop,” he said.
Craford would not say how much Alaska Seaplanes is offering to pay for the certificate. But he says the longer Ravn waits before selling off its assets, the less they’re going to be worth. He says Alaska Seaplanes wants to continue operating PenAir with its leased fleet of Saab [sob] aircraft.
Ravn’s chief executive did not respond to emails Friday.
The company is in line to receive $30 million in grants and $5 million in loans from the U.S. Treasury Department if it finds a buyer that will continue operating Ravn as a quote, “going concern,” the company said in a bankruptcy filing Thursday.