The Whispers Blog
Arkansas' breaking business news blog, with news and commentary from the Arkansas Business staff.
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Glo Airlines, a New Orleans startup public charter operator that offers flights at the Bill and Hillary Clinton National Airport, has filed for bankruptcy reorganization.
According to a petition filed today in the U.S. Bankruptcy Court for the Eastern District of Louisiana, Glo is filing Chapter 11 reorganization, listing between $10 million and $50 million in debt and $10 million and $50 million in assets.
AL.com reports that the company announced the move this morning, saying its direct air carrier/aircraft operator, Corporate Flight Management Inc. of Smyrna, Tennessee, had "failed on its contractual obligations to deliver quality performance and solid management of GLO's program to provide air service to chosen markets."
According to AL.com's report:
"After raising serious concerns over its performance and business practices, rather than find solutions, the air carrier unilaterally terminated its contract to operate GLO's program and fly passengers," the company said. "This entirely unjustified action has put GLO's operations and the financial health of many of GLO's partners at risk."
GLO said bankruptcy protection allows the company to "reorganize the business, protect jobs, and continue to fly." Spokesman Jordan Mitchell said the reorganization is underway.
New Orleans City Business reports that founder and CEO Trey Fayard aims to "promptly and successfully" emerge from reorganization "in the near future." He called the action "a difficult decision, but a necessary one to protect everyone involved."
A hearing in the case is set for tomorrow; Glo is seeking court approval for a $750,000 loan to continue operations while it sorts out its affairs. It said it moved more than 32,000 passengers through New Orleans last year and was on track to move about 40,000 through the city this year.
Fayard founded GLO Airlines in New Orleans in 2013, and the regional airline began operations in November 2015. In 2016, he told Arkansas Business that the Gulf and Mid-South regions "have been underserved by air carriers for a long time, resulting in an overreliance on road travel." Glo aimed to fill a need for affordable, regional air travel, providing services in Little Rock; New Orleans; Memphis; Shreveport, Louisiana; Huntsville, Alabama; Fort Walton Beach, Florida.
Arkansas Business contacted Glo for comment but has not received word back. We'll update when we do. (Update: Glo has reinstated all flights after reaching an agreement in bankruptcy court.)
Meanwhile, Fayard is scheduled to speak tomorrow at the regular weekly meeting of the Little Rock Rotary Club at the Clinton Presidential Library. (Update: No surprise — Fayard has had to cancel is appearance at the Rotary Club.)
Update: Clinton Airport spokesman Shane Carter said Glo told the airport late last week that "operational changes" would temporarily halt Glo flights from April 28 to the beginning May.
Glo currently offers a flight to New Orleans and, beginning May 5, had planned to resume a popular summer route to Destin, Florida.
Carter said the airport has been pleased with Glo's level of service, and that the New Orleans flight has been popular. He said the airport hopes the company's issues are resolved to minimize any passenger inconvenience.
Wal-Mart Stores Inc. of Bentonville announced today that it will hold its 2017 annual meeting on Friday June 2 at Bud Walton Arena at the University of Arkansas in Fayetteville.
The meeting, which begins at 8 a.m., will be webcast on the company's website.
The company hasn't yet released its proxy statement, which details executive compensation and shareholder proposals up for a vote.
The annual meeting routinely draws thousands to northwest Arkansas, including Wal-Mart employees from across the globe. In addition to regular business, the event usually features an array of celebrities. Last year's event was hosted by James Corden, and Katy Perry, Andy Grammer, Maxwell and Justin Smith made appearances.
Delta Regional Authority Federal Co-Chairman Chris Masingill is responding today to President Donald Trump's budget plan, which cuts or eliminates funding for a range of agencies and organizations. Among them, the DRA, which would be eliminated entirely.
In a statement, Masingill said the country's top goals are improving infrastructure and security for Americans, and casts the DRA a crucial actor in fulfilling those goals.
"You cannot advocate for infrastructure development and economic security in rural America without also supporting the mechanisms, such as DRA, that make those projects a reality," he said.
The DRA is a federal-state partnership created by Congress in 2000. It aims to "help create jobs, build communities, and improve lives through strategic investments in economic development" in 252 counties and parishes across eight states, including Arkansas.
The creation of the DRA was championed by then-President Clinton and members of Arkansas' congressional delegation. Then-U.S. Sen. Blanche Lincoln and then-U.S. Rep. Marion Berry, both Democrats, introduced legislation to create the organization, and then-U.S. Sen. Tim Hutchinson, a Republican and brother of Gov. Asa Hutchinson, co-sponsored.
Masingill's Full Statement
Since being created by Congress in 2000, DRA has been the leading advocate for supporting job creation, building communities, and improving lives across the eight states and 252 counties and parishes we serve in the Mississippi River Delta region and the Black Belt of Alabama.
Our nation's top goals include building our infrastructure and ensuring greater security for Americans. These are important and admirable priorities, but it is important to keep in mind that agencies such as DRA are proven vehicles for delivering a modern infrastructure, and security also means providing economic security to our people. DRA has an outstanding track record of making strategic investments in the physical and human infrastructure that supports the economic security of some of the poorest, most underserved communities in our nation.
DRA is on the ground every day working to improve rural communities. We're doing our part, and we're not alone. Our eight Governors, congressional delegation, local mayors and community leaders work well with DRA regardless of political affiliation. We conduct business with the highest standards of public accountability and operational excellence.
Our agency is not government as usual. We are a lean and effective organization that builds partnerships to invest in infrastructure improvements, workforce development, strengthening competitive communities and supporting small businesses, startups, and entrepreneurs. Throughout its history, DRA has added value to the budget approved each year by Congress. DRA has invested $163 million into more than 1,000 projects that have partnered with other public and private investments for a total of $3.3 billion. Those investments have helped to create and retain more than 26,000 jobs, train more than 7,200 workers for 21st Century jobs, and deliver water and sewer improvements to more than 64,000 residents.
You cannot advocate for infrastructure development and economic security in rural America without also supporting the mechanisms, such as DRA, that make those projects a reality. DRA has a dedicated team that will remain focused on the projects and programs that are building the Delta while we work through this long budget process.
As Chairman of DRA, I will continue to fight for the residents and businesses of our region. The people and communities in the Delta will always be worth fighting for.
Final draft rules of the Arkansas Medical Marijuana Commission will be published in statewide newspapers starting tomorrow and running through Monday, Feb. 27, marking the start of the formal 30-day public comment period.
The state Department of Finance and Administration posted the draft on Friday.
The medical marijuana amendment, adopted by voters in November, established the commission and required that it develop rules governing the licensure of marijuana cultivation facilities and dispensaries. Rules dealing with medical marijuana are also being drafted by the administration's Alcoholic Beverage Control and the state Department of Health.
People who wish to review and comment on the rules can visit the commission's website, and written comments can also be mailed to the commission, c/o Alcoholic Beverage Control Administration, 1515 Building 7th St., Suite 503, Little Rock, Arkansas 72201. They can also be submitted via email to MMCAdmin@dfa.arkansas.gov.
The commission plans to hold a public hearing on the draft rules from 2-6 p.m. March 31, at the UA-Little Rock Bowen School of Law.
Tyson Foods Inc. of Springdale — fresh off announcing a new leadership team — unveiled a new corporate logo and more details about its growth strategy Tuesday morning at the 2017 Consumer Analyst Group of New York (CAGNY) Conference in Boca Raton, Florida.
CEO Tom Hayes and Sally Grimes, president of Tyson's North American retail operations, charted the publicly traded meat processor's path in a presentation emphasizing sustainability, technology and the company's value-added and branded products.
One of the keys to growth: fresh foods. Grimes said that while fresh foods is functioning as a commodity right now, Tyson can find growth by applying a branded model to it. She noted that 74 percent of supermarket growth is taking place in fresh, unpackaged foods — items often found in the perimeter of grocery store.
Appearing on CNBC later this morning, Hayes said that perimeter is ripe for Tyson to find growth.
"We have so much potential in the fresh food space — it's where the shopper is going today. The perimeter of the store is where all the action is; the center of the store is dying," he said. "So we are doing everything to build fresh foods."
The executives also laid out strategies to find profit while building a sustainable food system, aiming to deliver healthier food, animals, workplaces and environment.
"As we make the right investments for the future, they'll pay for themselves in the present," Hayes said during the presentation.
Goals in that initiative include expanding its "no-antibiotics ever" chicken offerings, reducing workplace injuries and illnesses by 15 percent year over year, setting "science-based" sustainability goals and improving how chickens are raised.
It was also clear from the presentation just how transformative the $8.55 billion acquisition of Hillshire Brands in 2014 is to the company.
Tyson Foods has reoriented its management team to better focus on higher margin value-added branded products, and it aims to roll out more of those products in the coming months.
The portfolio is aimed at a consumer whose eating habits have changed from three square meals per day to "on demand" eating that takes place throughout the day — a lifestyle that might find Tyson's array of packaged protein products attractive.
In all, Hayes said Tyson aims to "lead for tomorrow by growing its portfolio of protein-packed brands and delivering sustainable food at scale."
"The purpose of our company is to raise the world's expectations for how much good food can do, and we're uniquely positioned to deliver just that," he said.
Below, video of Hayes' full CNBC interview, which also includes his comments about a U.S. Securities and Exchange investigation tied to a lawsuit that alleges the company colluded to fix chicken prices. Hayes called the claims "baseless" and that they represented "plaintiffs' lawyers grasping at straws."
Tom Hayes on CNBC
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