A federal bankruptcy judge has finally signed off on the sale of Silver Airways, which ceased operations in early June.
U.S. Bankruptcy Judge Peter Russin entered a signed order Thursday after conducting an emergency status hearing requested by lawyers for the buyer, an affiliate of Wexford Capital of West Palm Beach and Greenwich, Conn. Previously, one of its affiliates provided the troubled airline with debtor-in-possession financing while another — Argentum Acquisitions LLC — became a stalking horse bidder whose $5.775 million offer prevailed after Silver did not attract any qualified rival bids.
Originally, Silver management was to operate the airline while the buyer secured Federal Aviation Administration regulatory approvals. But the company retreated from the operations portion of the deal after it learned Silver had lost $1 million in revenue in late May due to a brief FAA-mandated shutdown of the airline. The issue was over a failure to update battery kits across Silver’s fleet of turbo-prop planes.
The airline permanently ceased operations June 11 after Argentum declined to fund its continued operations, citing the $1 million loss.
After more than a week of exchanges between lawyers, the judge signed the deal on Thursday
Under the revised deal, Argentum is acquiring most of the airline’s assets free and clear. But it is responsible for paying more than $9,400 in back taxes to the Broward County Tax Collector, as well as the salaries of eight employees who will help with the wind-down. according to the agreement.
The airline, which once served multiple Florida cities and locations in the Bahamas and Caribbean, once employed more than 800 people.
The deal all but closes out the saga of Silver’s efforts to restructure under Chapter 11 of the U.S. Bankruptcy Code, which failed after months of trying. Silver filed for protection from creditors on Dec. 30, 2024.
Silver’s affiliate in the Caribbean, Seaborne Airlines, which also filed for Chapter 11, has received a $200,000 stalking horse bid from an Orlando-based aviation firm called Nella Airlines. A June 24 hearing has been set to discuss the bidding procedures.
Earlier this month, the Association of Flight Attendants-CWA insisted the buyer should cover back payments to unionized flight attendants and pilots who took pay cuts shortly before the airline shut down. Sara Nelson, the AFA-CWA president, said the union opposed the revised buyout agreement. She said the issue should be heard before Russin and that the buyer should be forced to honor the unions’ labor contracts.
“Our union is opposing the revised agreement because Wexford is attempting to subvert the collective bargaining agreement,” she claimed. “Based on the filings, it appears that Wexford is trying to set up a separate entity to do the same flying currently covered under our contract.”
She said the attendants were supposed to be paid in full on June 13, “but only were paid 45% of what they’re due. Silver Flight Attendants are owed wages, deferred moving expenses, vacation, sick leave, and medical bills. The company also must abide by the WARN act meaning Flight Attendants are entitled to wages for 60 days.”
The court has received several letters from attendants and other employees requesting the court’s assistance and protesting the loss of pay.
“To date, we have not received our full compensation for the month of May, nor have we been provided with our severance payments,” Rogelio Benabe, a laid-off flight attendant, wrote in a June 13 letter. “Moreover, we are unable to apply for unemployment benefits, as we have not received any official notice of termination or layoff from the company.”
Benabe told the judge his “commitment to prioritizing employee welfare throughout this process has not gone unnoticed and is deeply appreciated.”
The union did not respond to a request for comment Friday about what it intends to do now that the Silver sales order has received court approval.
Brian Hall, the lead lawyer for Silver, did not respond to an emailed request for comment.
Wexford has made no statement in the wake of the sale order’s approval on Thursday. It did not respond to an emailed request for comment Friday about any future operations the firm might be contemplating.