This week, the U.S. cargo operator, Western Global Airlines (WGA), announced that they have filed for Chapter 11 protection.
This article will cover the details surrounding Western Global Airlines’ Chapter 11 filing and their secured financials from key shareholders to support a business reorganization plan.
Western Global Airlines: Chapter 11 Protection
In a bid to secure the operator’s future, Western Global Airlines (WGA) has this week announced that they have secured an agreement with its key financial stakeholders, including the operator’s founder, Jim Neff, in support of the cargo operator carrying out a reorganizational plan.
Alongside the agreement with its key stakeholders, WGA has also agreed with existing bondholders, the “Ad Hoc Group” that are holding more than 85% of outstanding senior secure notes which are due in 2025, to also back this reorganization plan.
As part of this plan, WGA has filed for voluntary Chapter 11 bankruptcy protection with the United States Bankruptcy Court for the District of Delaware. Western Global Airlines enters Chapter 11 with a DIP (debtor-in-possession) of more than $77 million from both its founder, Jim Neff, and the Ad Hoc Group.
The agreement of the reorganisation plan, named the RSA (Restructuring Support Agreement) consists of the Chapter 11 filing, as well as following the implementation of the reorganisation, the carriers’ material debt will be reduced by over $450 million, whilst also bringing in additional capital to support the carriers’ future operations.
WGA has said that during the process, the carrier will still operate as usual, ensuring that their customers continue to have the service they deserve.
Executive Comments
The carriers’ founder, Jim Neff, says, “As the Founder and CEO of Western Global Airlines, I have always understood the unique value proposition that WGA brings to the world as a reliable, responsive, and low-cost international air cargo provider.”
“I am—and always will be—loyal to WGA and its employee team. As such, my number one priority is preserving the long-term viability and value of WGA and protecting our employees. All my objectives regarding the Company align with this overriding goal. The plan we have outlined in the RSA reflects my continued dedication to and belief in WGA, along with the overwhelming support of our key financial stakeholders.”
“I am confident that this plan will tremendously strengthen our financial position and ensure a better future for WGA, our people, and our customers. As always, we have the utmost gratitude to our employees, loyal customer base, and industry partners for their enduring support and appreciate the continued collaboration with our largest financial stakeholders.”
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