Private equity group purchases PenAir assets

Deal assures continued operation as a subsidiary of Ravn Air Group

(Photo by Brandon Murphy, September 2017)

A New York-based private equity capital group that owns Ravn Air Group has purchased assets of PenAir, the vintage bush carrier than began in Bristol Bay in 1955, for $12.3 million.

J.F. Lehman & Co.’s bid for PenAir’s assets was approved in U.S. Bankruptcy Court in Anchorage, on Oct. 5, executives for Ravn and PenAir said in a joint announcement.

J.F. Lehman’s acquisition of PenAir will protect a substantial majority of company jobs, ensure continuity of operations and service to all PenAir routes, and create stability and better travel opportunities throughout the state, they said.

Dave Pflieger, president and chief executive officer of Ravn Air Group, called the acquisition “a win for all parties ­– our Alaska customers and communities, as well as PenAir and Ravn employees alike.”

The agreement calls for PenAir to keep its current name and continue to operate as a separate firm under a separate FAA certificate as a subsidiary of Ravn Air Group.

Danny Seybert, chief executive officer of PenAir, said that he and his father, PenAir founder Orin Seybert, were pleased with the court’s decision.

“This is a win-win for our employee group, and our friends and customers throughout rural Alaska,” he said.

J.F. Lehman’s bid was selected earlier in the week as part of a court-mandated auction of PenAir’s assets conducted by a court appointed trustee, but formal approval was required from the bankruptcy court. The deal still must be approved by the U.S. Department of Transportation and Federal Aviation Administration.

“It is a testament to the strength and fortitude of PenAir employees and the hard work and commitment of all Ravn Air Group team members that JFL was able to pursue the acquisition of such a storied airline, which, like Ravn, has a rich history of serving Alaska,” Pflieger said. “We are all very excited about our collective future and working together toward a shared goal of providing the very best in safety, operational excellence, customer service, and employee pride throughout Alaska.”

Ravn Air Group, headquartered in Anchorage, has over 1,000 employees and operates a fleet of nearly 70 aircraft on more than 400 flights daily from hubs in Anchorage, Fairbanks, Bethel, Aniak, St. Mary’s Nome, Kotzebue, Unalakleet, Utqiagvik and Galena. Earlier this year Ravn expanded service to Dillingham and King Salmon and will add McGrath in October.

PenAir currently serves six communities in Southwest Alaska. Schedule changes for St. Paul, St. George and Dillingham were announced recently. PenAir suspended its service to McGrath as of Sept. 28.

Lehman, a private equity firm founded in 1992, focuses exclusively on investments in the aerospace, defense, maritime, government and environmental industries and companies using technical capabilities that originate from these sectors.