Lilium, the electric vertical takeoff and landing aircraft developer, has secured its future after recently signing an investment deal with Mobile Uplift Corporation. The company, which found itself in financial distress, filed for bankruptcy at the end of October 2023. The agreement, which is expected to close by early January, allows Lilium to resume operations.
CEO Klaus Roewe expressed optimism about the acquisition, stating, "We are very pleased to announce the signing of the investment agreement with a very experienced investor consortium. The completion of the transaction at the beginning of January will allow us to resume our business operations." This encouraging news follows the company's desperate measures to secure funding, as it was running out of cash after years of development.
Lilium has been working diligently for the past decade to bring its innovative aircraft to market, with plans for the first manned flight set for early 2025 and the initial customer deliveries expected by 2026. The acquisition marks a significant turning point, potentially providing the financial lifeline Lilium desperately needs to continue with its ambitious projects. "The completion of the transaction at the beginning of January will allow us to resume our business operation," Roewe reiterated, emphasizing the importance of this transition.
The firm has confirmed it holds approximately 700 firm and pre-orders from clients across the United States, the United Kingdom, France, Saudi Arabia, and other countries, highlighting strong interest and demand for its cutting-edge aircraft. So far, investors have poured around 1.5 billion euros ($1.6 billion) before Lilium’s insolvency, but the costs of obtaining certification and ramping up production will require significant financial backing.
Even with this promising acquisition, the path forward is strewn with challenges. Lilium reported it spent close to 200 million euros just in the first half of 2024. Every penny counts when it’s stated the company requires several hundred million euros to progress on its projects, making the acquisition from Mobile Uplift all the more pivotal for its recovery.
Notably, the German government turned down Lilium's request for a 50 million euro loan guarantee, leading to fears about the sustainability of its operations. Yet, this new agreement with Mobile Uplift seems to offer the support needed to navigate out of bankruptcy and restart business operations. Once the acquisition is finalized, it is expected to restructure its subsidiaries and end the preliminary bankruptcy proceedings initiated by the local court.
The announcement of the acquisition offers hope to existing staff, many of whom were laid off prior to the deal. Roewe indicated the consortium intends to rehire these employees, offering them another chance to be part of this innovative venture. The prospects of restoring these positions will not only benefit the employees but also reinstate expertise within the company as it grooms for the next stages of product development.
Prior to filing for bankruptcy, Lilium had captured significant market attention within the aviation sector, making strides alongside the ambitions of establishing the eVTOL (electric vertical takeoff and landing) industry. This recent acquisition, facilitated by investors from both Europe and North America, reflects confidence amid challenges and investors' commitment to the vision of modern air mobility.
It remains to be seen how effectively Lilium can return to the skies with its game-changing aircraft technology and secure financing to see its dream come to fruition. Should the terms of the deal be met, Lilium will not only have the chance to correct its course but also fulfill its long-held ambition of making urban air mobility more accessible and practical as it gears up for its fleet rolling out across major cities.
With many eyes on the startup, investors and industry experts alike will watch closely as it transitions from crisis to opportunity, leveraging its innovative technology, positioning, and vast order book for growth. Lilium stands at the cusp of revival, waiting for the finalities of the transaction to propel it back onto the international stage of aerospace innovation.
