Delta Swoops In, Takes A 95 Percent Interest In Troubled Wheels Up

Delta Air Lines has stepped in to take over almost complete financial control of Wheels Up with $500 million in funding, assuming 95 percent ownership of the charter/fractional ownership company. Wheels Up, which currently ranks as the third-largest private aviation provider after NetJets and Flexjet, has faced financial headwinds. Yesterday (Aug. 14), it reported a working capital deficit of $720.8 million in a Form 10-Q filing with the U.S. Security and Exchange Commission (SEC). The company also self-reported recurring losses in the first two quarters of this year.

According to online information source Private Jet Card Comparisons, the non-binding agreement with Delta includes “a $400 million term loan and a $100 million liquidity facility from Delta, totaling $500 million to Wheels Up.”

Delta sold its Delta Private Jets unit to Wheels Up in 2020. Prior to the current agreement, the airline was Wheels Up’s largest shareholder, controlling a 20 percent interest. Under terms of the new deal, according to Private Jet Card Comparisons, Wheels Up members can use money they’ve put toward deposits to purchase tickets on Delta flights. Wheels Up customers also earn additional credits in the airline’s SkyMiles frequent flyer program. This can serve Delta, in that it brings a substantial population of sought-after high-end travelers into its customer base.

Conversely, Delta CEO Ed Bastian said, “The partnership will create new opportunities for Wheels Up to drive strategic, operational, and financial improvements for its customers in the months and years ahead.”