Published Monday, March 2, 2009 | 10:44 a.m.
Updated Monday, March 2, 2009 | 5:50 p.m.
Beyond the Sun
A big Southern Nevada air tour business filed for bankruptcy protection Friday and has laid off 20 employees, citing the economic downturn that has reduced interest in aircraft tours of the Las Vegas Strip and the Grand Canyon.
Filing for Chapter 11 reorganization and seeking court approval to continue operations were five companies associated with the Trenk family: TTF Helicopters LLC, Stars & Stripes Air Services LLC, Stars & Stripes Air Tours LLC; King Airelines Inc. and Las Vegas Helicopters Inc.
The attorney for the companies seeking to reorganize could not immediately be reached for comment Monday.
The bankruptcy filing in Newark, N.J., by Roseland, N.J.-based TTF said it has some $1.9 million in assets and $1.7 million in liabilities; and that one of its biggest creditors is Cessna Finance Corp. of Wichita, Kan., owed some $1.7 million for a helicopter operated by the debtors. Las Vegas Helicopters listed assets of $9.97 million and liabilities of $10.25 million; King Air had assets of $255,000 and liabilities of $704,000; Stars & Stripes Air Services had assets of $3.6 million and liabilities of $2.9 million and Stars & Stripes Air Tours listed no assets and liabilities of $1.77 million.
"The debtors filed their petitions as a result of the lack of cash flow due to the unprecedented global economic downturn which has hindered the tourist industry, especially in the Las Vegas area (and) acquisitions which were leveraged beyond the debtors' ability to service the debt as a result of, among other things, the economic downturn; and (an) extraordinary seasonal slow down as a result of the economic downturn,'' Steven Trenk, managing member of TTF Helicopters LLC and Stars & Stripes Air Services LLC and president of King Airelines Inc. and Las Vegas Helicopters Inc., said in the court filing.
Including the 20 workers furloughed just prior to the bankruptcy filing, TTF and its affiliates have slashed employment from 157 employees to 93 as the recession cut travel to Las Vegas. For instance, McCarran International Airport last week said it served 3 million passengers in January, down 15.7 percent from January 2008 and the 11th consecutive monthly decline.
"The debtors will file a plan of reorganization to restructure debt and streamline operations, while continuing the remainder of their businesses as a going-concern for the benefit of all stake holders,'' Trenk said in the filing.
The bankruptcy filing says that just prior to the nation's severe economic downturn, the company expanded through acquisitions of tour operators. These businesses operate from the Boulder City and North Las Vegas airports.
Trenk said that in January 2006, affiliates of the debtors bought a 50 percent interest in Las Vegas Helicopters, which at that time had no revenue, and in March of that year started operating that business from the Boulder City Municipal Airport through a lease it arranged through Air Excel. Trenk said he later purchased Air Excel for $2.4 million through the newly created Stars & Stripes Air Services. The bankruptcy filing listed the value of the Boulder City lease as $2.5 million.
City Attorney Dave Olsen said filing for bankruptcy is a violation of the operators' lease with the city.
The city has the option of asking Stars and Stripes and Las Vegas Helicopters to leave Boulder City Airport, Olsen said, but no decision has been made yet.
"We don't have to act right away," he said.
The tour operators assured the city they were capable of continuing to pay rent, Olsen said.
Affiliates of the debtors in June 2008 then purchased the Cheyenne Heliport Facility at the North Las Vegas Airport for $5 million. Trenk said that business is a strategic asset ideally suited to offer air tours of the Las Vegas Strip.
Stars & Stripes, with 19 employees, operates a fixed base operation at the Boulder City airport, the filing said. That company sells fuel and flight materials such as aerial maps, maintains airplanes and helicopters and operates a flight school.
Las Vegas Helicopters, with 53 employees, has an agreement with Oriental Travel and Tours to market the "Grand Canyon West Helicopter and Pontoon Boat Tour'' that includes a helicopter shuttle and boat rides on the Colorado River originating from Grand Canyon West and Las Vegas. Some of the tours include the Grand Canyon Skywalk. Las Vegas Helicopters also has a deal with Hwal'Bay Ba:J Enterprises, which is owned by the Hualapai Tribe, to operate tours within that tribe's reservation. These tours of the Grand Canyon originate at the Boulder City airport.
The debtors said they also offer airplane tours of the Grand Canyon and Las Vegas areas through King Air, which has three planes and 21 employees and was acquired in July 2008 for $800,000.
All of the debtors' aircraft insurance policies are current and in force, the bankruptcy filing said.
Cassie Tomlin contributed to this report.
Steve Green can be reached at 990-7714 or [email protected].