Western Global stable as it completes financial restructuring
06 / 12 / 2023
Source: Carlos Yudica/Shutterstock
US FAA 121 certified cargo airline Western Global Airlines (WGA) has successfully completed financial restructuring and emerged from Chapter 11 bankruptcy proceedings.
The widebody freighter operator filed for Chapter 11 bankruptcy protection in August, while also reaching an agreement with financial stakeholders on the company’s reorganisation as part of efforts to stabilise its operations.
Under its reorganisation plan, WGA has materially reduced its debt by more than $460m and now has less than $100m of funded debt, said the airline in a press release on December 5.
The company said it has retained its fleet of four Boeing 747-400 and 15 MD-11 freighters, as well as two MD-11F’s that have “not yet been conformed”.
Apart from one leased aircraft, all aircraft, engines, and spare parts are 100% owned by the reorganised WGA, said the airline.
“As the Founder and CEO of Western Global Airlines, my top priority has always been to preserve the long-term viability of our Company and protect our people. I am pleased our restructuring process has achieved that,” said Jim Neff.
“It continues to be a privilege to lead our team, especially as WGA has emerged stronger and ready to thrive again as it has historically done. As always, I am immensely grateful to our employees, customers, and partners for their enduring support as we navigated this process.”
WGA’s reorganisation plan was confirmed by the US Bankruptcy Court for the District of Delaware.
The airline restructured its debt through an in-court process over the period of 100 days.
In June, prior to filing for Chapter 11, Neff purchased $115m of outstanding senior secured debt for $45m to help improve the company’s lending conditions.
And earlier this year, ratings agency Moody’s downgraded the carrier’s ratings from B2 and B3 – later withdrawing its rating – citing a liquidity shortage.
The airline’s troubled year is in contrast to its expansion plans during the high demand, low capacity Covid era.
In late 2021, WGA had plans to expand its freighter fleet approved by the US Department of Transportation.
Two months later the carrier confirmed its now cancelled order for two 777 freighters from Boeing.
