Kestrel finds investor after financial issues
Kestrel Aircraft, a Superior, Wisc.-based airplane manufacturing startup with an office at Brunswick Landing, has found an investor after experiencing financial issues over the past year.
Flightglobal.com reported on Tuesday that the new investment will allow Kestrel to create its first single-engine turboprop aircraft within the next three years, but the current time-table could be accelerated if another investor jumps on board.
RJ Siegel, Kestrel's chief technical officer, told the website that the investor is from outside the United States, but did not disclose the investor's identify, nor details of the investment.
“[The investor] just wants to move into the aviation industry because he sees that it’s a particular growth industry for his country,” he said.
A spokesperson for Kestrel did not respond to a request for comment by press time.
The trade publication Aviation International News has previously reported the company needs to raise $125 million to get the aircraft through Federal Aviation Administration certification.
The news of Kestrel's investment follow reports from over the last year that detailed the company's financial issues and problems with attracting investment.
According to a May report from Wisconsin ABC affiliate WDIO, Kestrel said its delay in financing has impacted the project and caused the company to reduce its 65-employee workforce in Superior, though details of the reductions were not disclosed. The report said Kestrel was in the process of restructuring two $2 million loans from the Wisconsin Economic Development Corp.
As of July 14, Kestrel's Brunswick location employs 27 full-time and six part-time employees, according to a recent report from the Midcoast Regional Redevelopment Authority.
Last September, the Bangor Daily News reported the company was behind in paying its rent and vendors, and also had cut health, life and dental insurance for employees after failing to pay premiums. CEO Alan Klapmeier said at the time that the company “has been short of cash,” and that its turboprop aircraft, originally scheduled to launch in January, is a year behind schedule.
Industry watchers told the BDN at the time that such struggles with financing are typical for aircraft startups. In early 2012, the company announced its decision to move its manufacturing to Superior after touting the potential to add 600 jobs at its Brunswick facility by 2016.
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