Flair Receivership

[dialdriver]

$140 million at 18%!!

https://biv.com/article/2021/07/lawsuit ... nsion-plan

[RRJetPilot]

That’s 32,400,000 Cunukistan loonies a year In interest. How many flights a day does flair have? 10? Just spitballing. But that’s 9k in interest per flight they fly….. 47$ of each seat goes to pay back the interest of the loan.

I just don’t get the numbers. Someone smarter than me can explain?

[boeingboy]

Why would any of that surprise you?

[Lt. Daniel Kaffee]

18% of $140,000,000 works out to $25,200,000

[dialdriver]

It's called growing bankrupt.

[ALPApolicy]

18% of $140,000,000 works out to $25,200,000

USD denominated loans?

[palebird]

Well well..all of a sudden things are not looking so well..too good to be true..pie in the sky you know the standard Canadian grifter

[TheStig]

Trying to figure this out, maybe someone can fill in the blanks?

In 2018 Prescott owned 68% of Flair, they needed to pay off debt and brought in 777 Partners who loaned Flair 140M. It was a loan to payoff another loan but... don't call it a buy-in because that would push the foreign ownership beyond limits. However, now Prescott is saying 777 Partners began running the airlines growth plan and they don't agree with it and want 777 Partners to buy them out. While 777 Partners is threatening to withdrawn their investment (with interest). Messy.

[Ash Ketchum]

My non pilot friends are all praising Flair for their low prices to fly across Canada. I knew it sounded too good to be true and that the company likely wasn't turning a profit.

[rudder]

The CTA will have to keep a close eye on the goings on at FLAIR re: foreign ownership and/or control.

[GRK2]

Can any of you people show us where that 18% figure actually comes from? I see it posted here but can't seem to find any official references to it. Serious question.

[montado]

Can any of you people show us where that 18% figure actually comes from? I see it posted here but can't seem to find any official references to it. Serious question.

In the article it says the majority of the 140 is at 18 percent… so that could mean 71 million is at 18 percent and the rest is at something way more reasonable. It doesn’t make it specifically clear exactly what the terms are. So best case half of it is at 18 percent.

[atpilot]

Contrary to any false rumors, Flair is not in receivership nor is it going bankrupt!
Have a great day!

[notwhoyouthinkIam]

Contrary to any false rumors, Flair is not in receivership nor is it going bankrupt!
Have a great day!

I hope that you are correct and that this point remains correct for a good amount of time to come.

[tbaylx]

My non pilot friends are all praising Flair for their low prices to fly across Canada. I knew it sounded too good to be true and that the company likely wasn't turning a profit.

Happy to hear that people are realizing they have options other than paying ridiculous fares that they were being charged before Flair came into the market. We're looking forward to continuing to make travel affordable in many more markets as we grow

[DanWEC]

Why is the title of this thread Flair Receivership?

[FurHat]

I imagine it is because of the allegation by the plaintiff in the article:

"Meanwhile, directors of 777 Partners have allegedly threatened to call in Flair’s debt and put it into receivership if it doesn’t proceed with the leases and expansion plans, which Prescott claims are not in Flair’s best interest."

[rudder]

I imagine it is because of the allegation by the plaintiff in the article:

"Meanwhile, directors of 777 Partners have allegedly threatened to call in Flair’s debt and put it into receivership if it doesn’t proceed with the leases and expansion plans, which Prescott claims are not in Flair’s best interest."

To be clear - having a lender “call in debt” was exactly what put Skyservice in to receivership.

Third party issues are just as relevant as first and second party issues.

[CaptainHaddock]

Reasonable airline ticket prices? It cost more to fill up your truck then it does to fly. A $59 ticket is as absurd as the $1 Jetsgo tickets were. Why everybody thinks airline tickets should be so cheap is bizarre. $1.70L for gas, average Canadian house cost is $680000, $5 for a litre of milk-but heh, airline tickets should be cheap. 737 Max’s aren’t cheap, they burn 6000lbs of fuel an hour, plus all the ancillary fees the government charges. Anyway, off topic a bit, I find the cheap ticket mantra strange.

[flying4dollars]

Reasonable airline ticket prices? It cost more to fill up your truck then it does to fly. A $59 ticket is as absurd as the $1 Jetsgo tickets were. Why everybody thinks airline tickets should be so cheap is bizarre. $1.70L for gas, average Canadian house cost is $680000, $5 for a litre of milk-but heh, airline tickets should be cheap. 737 Max’s aren’t cheap, they burn 6000lbs of fuel an hour, plus all the ancillary fees the government charges. Anyway, off topic a bit, I find the cheap ticket mantra strange.

Airlines know they don't make money off just the base $59 or whatever the sector bottom line fare is for a flight. But it's not JUST $59. It's the add-ons. And in the ULCC world, there is a lot of that and it adds up.