Air taxi maker Volocopter files for bankruptcy
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Air taxi developer Volocopter in Germany has filed an application to open insolvency proceedings.
The Karlsruhe Local Court has began the provisional insolvency administration and appointed Tobias Wahl at Anchor Rechtsanwältegesellschaft mbH as its administrator.
Volocopter, founded in 2011 with Intel as a backer, has been developing a two seater electric air taxi and a digital backbone that connects aircraft, infrastructure, and operators, the VoloIQ. It has carried out over 2000 test flights.
Like fellow German electric jet developer Lilium which was rescued from bankruptcy just before Christmas, Volocopter says it is nearing aircraft type certification for the launch of its urban eVTOL, the VoloCity, in 2025. UK eVTOL air taxi developer Vertical Aerospace also saw a financial restructuring finalised the day before Christmas to reach certification.
“We are ahead of our industry peers in our technological, flight test, and certification progress. That makes us an attractive company to invest in while we organize ourselves with internal restructuring,” said Dirk Hoke, CEO of Volocopter.
The company has raised $770m and claims to have the lowest one of the lowest burn rates in the industry. “However, despite recent intensive fundraising efforts, finding a viable solution to maintain regular operations outside of insolvency proceedings has not been possible,” said Hoke.
Business operations will continue as usual during the provisional insolvency proceedings, and the administrator has now held a staff meeting to inform employees about the current situation and answer initial questions about the proceedings. In addition, Wahl has initiated an investor process.
“The company needs financing to take the final steps towards market entry. We will endeavour to develop a restructuring concept by the end of February and implement it with investors,” said Wahl.
The Vertical deal sees existing investor Mudrick Capital Management convert $130 million debt into equity at fixed conversion price at provide $25m of additional funding and a $25m ‘backstop’ to avoid the same issues as Volocopter and Lilium.
“Ending this momentous year with a finalised funding commitment and strong shareholder backing is a tremendous milestone. This moment sets us up perfectly for our biggest year yet – with new investment, piloted testing progress and major technological developments all on the cards,” said Stuart Simpson, CEO at Vertical, who expects a funding round to be completed in Q1 of 2025 for the type certification of Vertical’s VX4 four person air taxi.
In the meantime Mudrick Capital completed the conversion of $130 million of debt into equity at a conversion price of $2.75 per Ordinary Share and agreed to fix the conversion price for the remaining $130 million at $3.50 per Ordinary Share. It also agreed to extend a loan repayment date by two years to December 2028.
www.volocopter.com; www.vertical-aerospace.com
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