Lilium signs asset purchase agreement in effort to restart business operations

German electric vertical take-off and landing (eVTOL) aircraft manufacturer, Lilium, has taken a significant step toward restructuring.

The company announced today that it has signed an asset purchase agreement with Mobile Uplift Corporation GmbH, a newly formed entity backed by an experienced consortium of investors from Europe and North America.

The agreement covers the operating assets of Lilium GmbH and its subsidiary Lilium eAircraft GmbH.

The proceeds from the sale will be utilised in accordance with German insolvency law, with no distribution of funds to Lilium N.V.

Under the agreement, Mobile Uplift Corporation GmbH plans to acquire and restructure the subsidiaries, aiming to secure sufficient funding to restart their business operations.

Furthermore, the deal is subject to certain conditions precedent, including the approval of the creditors’ committee and the opening of formal insolvency proceedings.

The transaction is expected to close in early January 2025.

“We are very pleased to announce the signing of an investment agreement with a very experienced consortium of investors, which is a major breakthrough,” said Lilium CEO Klaus Roewe.

“Deal closing at the beginning of January will allow us to restart our business.”

Insolvency and layoffs

After filing for insolvency in October due to an unsuccessful bid to secure emergency funding from the German government, Lilium ceased its operations this month.

The decision resulted in the layoffs of approximately 1,000 employees, with a small team retained temporarily to manage the liquidation process.

Moreover, in the months leading up to this development, KPMG spearheaded a restructuring process, engaging with potential investors to explore opportunities for the company’s assets and subsidiaries.

Additionally, the creditor’s committee played a pivotal role in evaluating proposals to identify the best path forward.

Founded in 2013, Lilium aimed to transform urban and regional mobility with its eVTOL aircraft capable of speeds up to 100 km/h.

The company’s vision attracted major backers, including Tencent, and garnered significant interest from customers, such as Saudi Arabia’s flag carrier, which had placed an order for 100 electric jets.

The planned restructuring aims to enable Lilium GmbH and Lilium eAircraft GmbH to exit self-administration proceedings and potentially resume operations under new ownership.

If successful, this move could mark the beginning of a new phase for the eVTOL pioneer.