Mark Huber is an aviation industry veteran who has worked in the flight training, aircraft sales, aircraft component, and airport development businesses. He has flight time in more than 50 different and diverse aircraft, including helicopters, aerobatic aircraft, vintage warbirds, jet fighters, business jets and turboprops, and transport-category aircraft. He has jumped out of several of these—on purpose—with a parachute. His defense and aviation journalism has been published in a variety of national and international periodicals.

Contributor

Mark Huber

Emivest Aerospace has had its court-administered Chapter 11 bankruptcy protection extended through midsummer while it tries to complete the sale of the companyπs assets to an entity owned by the Chinese government. Attorneys for the maker of the SJ30 light jet successfully petitioned the U.S. Bankruptcy Court in Delaware to give the company until May 18 to file a formal bankruptcy reorganization plan and until July 17 to gain creditor acceptance of it. Emivest filed bankruptcy on October 20 last year and has been operating on a reduced scale with debtor-in-possession financing.
The company said it needs the extra time to maximize "the value of the debtorπs estate through the sale process" to the benefit of "all parties of interest."
Emivest is seeking to have its assets acquired by China Aviation Industry General Aircraft (CAIGA, also known as Avic General Aviation), the same company that <a href="?q=node/24618">acquired the assets of Epic Aircraft</a> last year out of bankruptcy for $4.3 million. In a much larger deal, CAIGA is also currently pursuing the purchase of U.S.-based general aviation engine maker Teledyne Continental Motors for $186 million. CAIGA is expected to purchase Emivest's assets for $19 million, contribute additional operating cash and assume certain liabilities.
Creditor Williams International, which makes the SJ30's FJ44-2A engines, is urging the court to approve the Emivest asset sale to CAIGA, noting that the Chinese firm planned to invest "more than $100 million" to restart SJ30 production. In a letter to bankruptcy judge Mary Walrath, Williams CEO Gregg Williams said that he knew of "no other bidder who could match CAIGA's resources or its commitment" to the SJ30. Williams concluded, "To award the SJ30 assets to anyone other than CAIGA would almost certainly result in the disappearance of the company."
The SJ30 was designed by Ed Swearingen in the 1980s and certified in 2005 after 16 years of development and estimated expenditures of $700 million. To date, four of the $7.25 million twinjets have been delivered, including one to actor/pilot <a href="http://www.bjtonline.com/people/center-stage/s/p/1/article/morgan-freeman-2191.html">Morgan Freeman</a>. At one time, the company claimed orders for more than 200 aircraft. However, at least 150 of those were from one customer, London-based Action Aviation. No aircraft have been delivered since 2009. The company maintains manufacturing facilities in West Virginia and Texas. In 2008, <a href="?q=node/16734">Dubai-based Emivest purchased 80 percent of the company then known as Sino Swearingen</a>, announced plans to inject $1 billion into it and renamed it Emivest Aerospace. Emivest's investment was far less. Court documents reveal that Emivest actually infused $38.4 million into the company from a revolving credit line.
Chinese Industry Plans
Acquiring the assets of distressed U.S. aviation companies, including Epic, Continental and perhaps Emivest, appears to be a quick way for China to make a big entry onto the worldπs general aviation stage. Last year at Airshow China, CAIGA unveiled two new indigenous general aviation aircraft, the Seagull 300 amphibian and the Little Eagle 500, an aircraft that appears to be a copy of a Socata TB20.
Clearly, China has set its sights higher. Currently, there are only 900 general aviation aircraft based in China, but it is clear that the government there is taking aggressive steps to change that, according to the U.S.-China Economic and Security Review Commission (USCC). The USCC maintains that China's overarching national aviation policy includes large government investment in aviation, an offset policy that mandates technology transfers from foreign firms as a condition to gaining access to China, and close coordination between Chinaπs military and civil aviation sectors. In its annual report to the U.S. Congress last year, the USCC noted, "The development of Chinaπs aviation industrial base would not be possible without the strong support it receives from the Chinese government. Beijing considers Chinaπs commercial aircraft industry a strategic industry and has made its development a national priority."

Bankrupt Emivest Seeks Chinese Buyer

Emivest Aerospace has had its court-administered Chapter 11 bankruptcy protection extended through midsummer while it tries to complete the sale of the com

2024 Corporate Aviation Leadership Summit

AIN Products

SUBSCRIPTIONS

RESOURCES

ABOUT AIN