Amerijet Undergoes Major Restructuring: Returns Aircraft, Lays Off Staff Amid Financial Struggles

Amerijet, a Miami-based midtier cargo airline, announced a significant restructuring effort on Wednesday, involving the return of six freighters to lessors, layoffs of nonpilot personnel, and securing $55 million in capital from existing lenders. This move aims to stabilize the airline’s faltering finances and operations amidst a challenging economic climate in the airfreight industry.

The company plans to hand back six Boeing 757 freighters to its lessors and defer agreements to add more Boeing 767 cargo jets to its fleet, a decision aimed at improving cash flow. Notably, three of these freighters were leased from aviation service provider AerSale.

Details of the restructuring were limited, but an industry insider revealed that the changes are part of a distress sale initiated by ZS Fund to another private equity firm. This transition led to a complete overhaul of Amerijet’s board of directors, with the appointment of new members by the new owners.

The restructuring also suggests that the involved banks may have gained an ownership stake in exchange for the capital infusion. At the time of publication, Amerijet officials had not responded to inquiries.

Amerijet has been grappling with a significant downturn in airfreight volumes over the past year, impacting its financial stability more severely than many competitors. The company faced declining revenues while expanding its operations, anticipating continued growth from pandemic-related business surges. However, factors like weak demand, maintenance issues with its 757 freighters, certification delays for converted freighters, and reduced business from major clients like DHL Express and the U.S. Postal Service have strained the airline’s finances.

A year ago, Amerijet’s fleet had expanded to 22 aircraft, but recent months saw seven of these planes grounded. The company, which employs fewer than 1,000 people, has already undergone two rounds of layoffs in the past year.

“We are pleased that we were able to complete this restructuring with the support of our investors and lessors. These strategic actions have strengthened the company’s financial foundation, ensuring its scheduled service and contract flights will continue to operate as usual,” said CEO Joe Mozzali in the announcement. Mozzali took over leadership in early October, following the ousting of former CEO Tim Strauss.

The exact number of employees affected by the layoffs was not disclosed, but sources indicate that over 50 workers received notices on Wednesday Jan. 10, 2024.

Amerijet currently operates three Boeing 767s for Maersk Air Cargo on routes between Asia and the U.S. In addition, the airline recently secured a contract for four weekly flights between Bogota, Colombia, and Miami, as well as a multiyear contract for transporting express and cargo volumes in Central America and the Caribbean for a global integrator.

Sources: AirGuide Business airguide.info, bing.com, freightwaves.com