With most of its salable assets already in the hands of other entities, the nearly six-year run of Albuquerque, New Mexico-based One Aviation came to an end Thursday with an order by U.S. Bankruptcy Court Judge Christopher S. Sontchi to liquidate the company’s remaining assets.
“I've lost confidence in management,” Sontchi said in converting One Aviation's reorganization effort, which began in October 2018, to Chapter 7 liquidation. “We need an independent fiduciary to come into this case and have a look at it…we need to stop the music here.”
None of the remaining parties in the case opposed the ruling, including Citiking International, which had intended to take control of One Aviation upon its exit from Chapter 11 reorganization. However, the Chinese-backed entity repeatedly failed to make good on its court-approved emergence plan, leaving One Aviation to pursue alternatives to keep the company whole.
Following an aborted Section 363 asset sale attempt, One Aviation received court approval in November to sell off the Eclipse 500/550 program to AML Global Eclipse LLC, with Nautical Hero Group bidding for assets related to Kestrel Aircraft. Arguments on the disbursement of funds from those sales and remaining company assets will now proceed under stewardship from the U.S. Trustee Program.
AML Global has maintained support for approximately 260 Eclipse aircraft worldwide and rehired many non-management One Aviation employees involved with that program. That process also hasn't been without some drama, as AML Global accused former management of hiding multiple files containing employee and financial records from the new owners, prompting a court order last month to preserve those documents.
“There were at least some allegations of some skullduggery…with the AML transaction,” Sontchi reiterated Thursday. “If [anything] disappears—documents get taken, file cabinets disappear—whoever’s responsible is going to feel the wrath of God."