US manufacturer Icon Aircraft filed for Chapter 11 bankruptcy protection last week as it tries to restructure in an attempt to attract a buyer.
The California company manufactures the up-market Icon A5 high-wing amphibious LSA.
According to the company, the Chapter 11 filing, which permits companies to continue operating without creditors forcing liquidation over unpaid bills, is part of a strategy to attract new ownership.
“We plan to continue to produce and sell aircraft and provide first-rate service, training, and support to our customers," said Icon CEO Jerry Meyer.
"We believe this process will enable the business to address its current challenges and emerge with new ownership–stronger than ever–and continue building amazing planes with a focus on innovation, safety, and incredible flying experiences.”
Icon Aircraft said it would maintain contact with its customers, suppliers, employees and other stakeholders with updates on critical developments during the restructuring and Chapter 11 process.
“The purpose of the Chapter 11 filing is to resolve the company’s financial challenges and position the A5 for success for years to come," Meyer said.
"We understand that this situation creates a hardship for everyone involved. However, without taking these steps, there is not a viable path forward for the business to do what we do best – build incredible airplanes and support our aircraft owners.”
Kirk Hawkins and Steen Strand founded Icon in 2006 in response to the new LSA rules. The first prototype A5 flew two years later, with the first production aircraft rolled-out in 2014.
At its peak, Icon was thought to have orders for 1400 A5s. However, Icon has been plagued with issues and problems almost from the outside including blow-outs in manufacturing costs, accidents and a controversial sale agreement.
Perhaps the issue that plagued Icon the most was a majority shareholding by Chinese company Pudong Science and Technology Investment, which has been accused of running roughshod over minority shareholders and attempting to send intellectual property back to China.
In January 2022, it was reported by the Wall Street Journal that both the FBI and the Committee on Foreign Investment in the United States were investigating the role of the Chinese shareholders amid concerns that the design of the A5 could have military implications including being used as a drone.
Icon has listed its total assets as being between $US100 million and $US500 million.