Last updated: 04:00 PM ET, Thu September 22 2016

SeaPort Airlines Grounds All Flights, Ceases Operations

Airlines & Airports Donald Wood September 22, 2016

SeaPort Airlines Grounds All Flights, Ceases Operations

Photo: SeaPort Airlines’ Plane (Photo via AviationTribune)

On Tuesday, a judge in Oregon ordered SeaPort Airlines’ Chapter 11 bankruptcy to be converted to Chapter 7 liquidation effective Wednesday, grounding all flights and ending the company’s reorganization efforts.

According to The Associated Press, officials at SeaPort Airlines were attempting to reorganize the company after filing Chapter 11 bankruptcy in February, but the airline lost a key contract and a line of credit which was helping to keep it in business.

SeaPort Airlines was officially grounded at 6 p.m. local time Tuesday, and a Portland International Airport spokeswoman revealed that the company would cease operations Wednesday.

“This is a very sad day for our employees, shareholders, and the communities we serve,” SeaPort Airlines President Tim Sieber said in a statement on the company’s official website. “I would like to extend my heartfelt appreciation to the employee team that I have been honored to lead and who delivered industry leading operational performance. While we made great strides, a successful financial reorganization did appear possible and we were forced to make the difficult decision to cease operations.”

Reports say that the airline’s employees were paid through Tuesday before the business officially closed its doors. SeaPort Airlines opened in 2008 and took its name Portland-Seattle route which it flew regularly.

Since opening, the airline expanded to Memphis, Tennessee, and added several new routes. It’s unclear what will happen to the company’s small fleet of Cessna 208 Grand Caravan turboprop aircraft.