Thursday, November 10, 2016
Helicopter Operator Erickson Files for Bankruptcy: Blames oil and gas companies that cut back on drilling operations during energy prices slump
The Wall Street Journal
By KATY STECH
Nov. 9, 2016 2:06 p.m. ET
Helicopter operator Erickson Inc. has put its flying fleet into bankruptcy, blaming oil and gas companies that cut back on drilling operations during a slump in energy prices.
Lawyers who put the Portland, Ore., company into bankruptcy on Tuesday said that profitability has declined since 2013 and that it couldn’t overcome “sustained economic distress” in the oil-and-gas industry, where it provides lift services for production rig equipment. Erickson officials said they plan to negotiate with lenders behind some of its roughly $561 million in debt.
The 700-worker company also struggled with the slower pace of U.S. military activity in Afghanistan, cutting the need for moving troops, delivering cargo to ships, airdropping supplies and rescuing personnel. Its defense revenues fell about 32% throughout last year to $105.2 million, said Chief Restructuring Officer David W. Lancelot in documents filed in U.S. Bankruptcy Court in Dallas. Workers have installed the HVAC unit on top of Dallas’s Chase Tower, removed the Statue of Freedom on top of the U.S. Capitol Dome, recovered sailboat wreckage, rescued an endangered rhino and delivered snow for the winter Olympics in Vancouver, according to court papers.
Any debt-cutting plan that Erickson officials put forward will need approval from Judge Barbara J. Houser.
The company, founded in 1971, has 69 aircraft, including its Aircrane model. It expanded in 2013 with the $26 million purchases of Brazil’s Air Amazonia Servicos Aeronauticos Ltda and the $298 million purchase of Evergreen Helicopters Inc., which expanded its military work.
Aside from its work in the defense and oil-drilling sectors, Erickson officials work on transmission lines for utility companies, wind turbine construction, timber harvesting and humanitarian relief efforts.
The company’s helicopters designed to fight forest fires can drop more than 25,000 gallons of water. It recently lost its “small business” designation because of an ownership change, causing it to lose $5.9 million in revenue from contracts with the U.S. Forest Service, according to court papers.
Original article can be found here: http://www.wsj.com
Posted by Kathryn on 12:39:00 AM