Troubled times continue at Commander Aircraft Co., as the Bethany, Okla.-based company is set to be liquidated.
After two failed attempts to find saviors for the bankrupt company, Commander’s December 2002 Chapter 11 bankruptcy filing has been converted to a Chapter 7 filing by the U.S. Bankruptcy Court in Delaware. All operations at the company have ceased and the court has appointed a trustee to oversee the liquidation of the company’s assets.
The latest action by the bankruptcy court occurred when Commander’s latest angel, Pilot General Aviation, defaulted on its plan to buy 80% of the company for $2.8 million. That followed a decision in July by Tiger Aircraft to pull out of a similar investment deal in Commander.
Pilot General, created by the forces behind Stonegate Capital Group, a Farmington, Conn.-based merchant bank, “could not come up with the rest of the financing” for the deal after putting up an initial $200,000, according to Wirt Walker, chairman and CEO of Aviation General Inc., Commander’s parent company. “They were not for real,” Walker said. “They forfeited over $200,000.”
Commander filed for an extension with the bankruptcy court, “believing we would come up with the financing,” he said. “There were several parties who were interested, but time just ran out.”
Walker believes some of those interested parties will show up to bid on Commander’s assets. Those assets include its FAA Type Certificates, tooling and equipment, inventory, work in process, furniture and fixtures, trademarks — everything necessary to manufacture, service and support the single engine Commander line.
“We believe potential buyers will be interested in buying the assets as a package, as together they are more valuable than they are individually,” Walker said.
The sale of the assets is expected to go “much faster” as the liquidation is “less fettered” than the Chapter 11 process, he noted.
The Commander was first designed and manufactured by Rockwell International Corp. Gulfstream Aerospace Corp. acquired the Commander line when it bought Rockwell’s General Aviation Division in 1981. In 1988, Commander Aircraft Co. was formed when the line was purchased from Gulfstream. The company implemented improvements to the proven Commander line, resulting in the new Commander 114B, which received a new Type Certificate in 1992. Next came the 114 AT (All Purpose Trainer) and the 114 TOC (Turbo-Charged).
In 2000, the company introduced the Commander 115 series of high performance, single engine aircraft.
The company’s revenues doubled from approximately $8.1 million in 1997 to $16.8 million in 2000, at which time it was profitable. However, its business was adversely affected by an ensuing stock market crash, recession, default of a credit line by an international dealer, the Sept. 11 terrorist attacks, and the subsequent march to wars, Walker said. Consequently, on Dec. 27, 2002, the company filed for bankruptcy. While new production was suspended, the company continued operations with a skeleton staff.
Those operations have ceased indefinitely “until the company finds its way into new hands,” Walker said. “I hope that would happen as quickly as possible. Commander is a world-class product. It is one of general aviation’s most renowned marques.”