Exclusive: Bristow Helicopters Offloads Loss Making Eastern Airways To Previous Owner
Bristow Helicopters made the news over the weekend as it announced it was entering Chapter 11 Bankruptcy in the US. The company has debts of over $1.6billion and is trying to restructure to continue operating.
In a recent 8k filling made by the company to the United States Securities and Exchange Commission, Bristow has revealed it has offloaded Eastern Airways, an Aberdeen based airline servicing small hubs in the UK which it independentley operated.
Oil and Gas People can exclusively reveal that the new owner of Eastern Airways is former 50% owner Richard Lake who sold his share of the business in 2014 retaining 20% which he then sold to Bristow Helicopters in 2018 giving them 100% ownership.
The filling documents had this narative:
Bristow Helicopters Limited, an indirect consolidated affiliate of the Company (“BHL”), together with its legal and financial advisors, has pursued various transactions to exit the Eastern Airways International Limited (“EAIL”) business, which has made negative contributions to our adjusted EBITDA in each of the last three fiscal years, including pursuing a sales process with several third parties over an extended period. On May 10, 2019, BHL completed the sale of all of the shares of EAIL to Orient Industrial Holdings Limited (“OIHL”), an entity affiliated with Mr. Richard Lake, pursuant to a Sale and Purchase Agreement (the “EAIL Purchase Agreement”).
Pursuant to the EAIL Purchase Agreement and related agreements, BHL contributed approximately £17.1 million to EAIL as working capital, OIHL acquired EAIL, BHL retained its controlling ownership of the shares in Humberside International Airport Limited that it previously held through EAIL and certain intercompany balances between BHL and EAIL were written off. As a result of the transaction, OIHL now owns and operates EAIL, which had previously operated as a separate unit within Bristow Group, and BHL maintains its controlling interest in Humberside Airport, from which BHL provides U.K. search and rescue services.
The EAIL Purchase Agreement contained customary representations and warranties. OIHL has agreed to certain covenants with respect to non-solicitation of directors, officers or employees of BHL for a period of 12 months. Pursuant to the terms of the EAIL Purchase Agreement, BHL has the right to appoint an observer to the board of directors of EAIL for an initial period of 12 months following the sale. EAIL has also agreed to provide certain transition services for a minimum of 12 months from the date of the completion of the transaction.
It was announced on 21 September 2017 that Eastern Airways would enter a franchise with Flybe, starting on 29 October 2017. The franchise means all flights operated by Eastern Airways carry BE (Flybe) flight numbers. The airline is believed to have 21 aircraft operating 13 routes accross the UK.
Oil and Gas People has reached out to both companies for comment.
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