Private aviation firm Wheels Up announced this week that it has sold off three non-core businesses in an effort to streamline operations.
The company sold Baines Simmons, Kenyon International Emergency Services, and Redline Assured Security to an unnamed “unrelated third party” for approximately $20 million in proceeds before transaction-related expenses. Wheels Up plans to use that money to advance its ongoing fleet modernization strategy.
Baines Simmons is an aviation regulation, risk, and safety management business, Kenyon provides disaster management services, and Redline specializes in security solutions and training.
“The divestiture of these non-core services businesses is the latest in a series of steps that Wheels Up has taken to sharpen our strategic focus, invest in our product, fleet, and operations, and strengthen our balance sheet,” said Wheels Up CEO George Mattson. “The sale, along with our recently announced initiatives estimated to drive approximately $50 million of cost efficiencies, is expected to create meaningful tailwinds on our path to sustained, profitable growth.”
Wheels Up allows members to book private air transport from its company fleet and third-party partners using a mobile app. It is currently modernizing its fleet with the addition of Embraer Phenom 300 series and Bombardier Challenger 300 series jets.
The company has struggled to achieve profitability for years, and even with improvements in its performance over the last calendar year, it is still not making money. It was at risk of being delisted from the New York Stock Exchange but came back into compliance in June.
A consortium led by Delta Air Lines received a 95 percent stake in Wheels Up in 2023 in exchange for $500 million in term loans and credit. The investment was widely seen as a rescue effort aimed at keeping the business viable. The arrangement gives Wheels Up members access to Delta rewards.
