Eos files for bankruptcy
Published: 28 Apr 2008
Eos has filed for bankruptcy in the US Bankruptcy Court in the Southern District of New York.
"This announcement is particularly regrettable since we have achieved so much, including having a term sheet in hand for additional financing. Clearly, even in today's challenging economic and credit environment, investors believe in Eos. Unfortunately, some issues arose that prevented the parties from moving forward," stated Eos, a premium-class airline operating flights between New York and London, on its website.
Of the four carriers launched in the all-business niche over the past two years, the closings of Eos this weekend and MaxJet in December leave only Silverjet of the U.K. and L'Avion of Paris.
Eos flew only 48 passengers on its Boeing 757s, styling itself a budget-first class service.
Silverjet, the last of the British all-business-class carriers, flies 100 passengers on its larger 767 aircraft and charges from £999 for a business-class return.
timesonline.co.uk highlighted that none of the three premium-only carriers that operated from Britain has ever made a profit. In regulatory filings in America, Eos said that it had lost $37 million (£18.6 million) in the first nine months of last year on revenue of $53 million. Silverjet was losing about £1 million a month and its share price has fallen from a peak of £2.09 last March to 14p.
Only few days back, Eos had agreed to a term sheet outlining the terms on which Eos was to secure an additional $50 million in capital from a current investor. The company had highlighted that the capital came at a stage when tight credit markets and an economic environment led to several industry failures.
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