CTL-Aerospace Inc., an aerospace manufacturing company, has filed for Chapter 11 bankruptcy protection and is moving quickly to sell substantially all of its assets through an auction process, according to court documents filed in the U.S. Bankruptcy Court for the Southern District of Ohio.
The Dayton-area company filed its bankruptcy petition on September 8, 2025, and within weeks submitted a comprehensive motion seeking court approval for bidding procedures that would culminate in an asset auction on December 10, 2025. The expedited timeline reflects the company's need to meet milestones tied to its post-petition financing arrangement with Wells Fargo Bank, which serves as the company's primary secured lender.
Major Aerospace Players Involved
The case has drawn the involvement of aerospace industry giants General Electric Company, operating as GE Aerospace, and Japan's Kawasaki Heavy Industries Ltd. Both companies have been designated as "consultation parties" in the sale process, suggesting significant business relationships or potential interest in the assets. The filing states that if either GE or Kawasaki submits a bid, they would be suspended from their advisory role until their bid status is determined.
"The Debtor argues that the expedited sale process is necessary to maintain access to post-petition financing and to maximize value for the estate," the court filing states. The company's continued access to cash collateral and post-petition financing depends on meeting specific sale milestones outlined in its debtor-in-possession financing order with Wells Fargo.
Compressed Sale Timeline
The proposed sale process operates on an aggressive schedule designed to maximize asset value while meeting financing constraints. Key deadlines include:
- December 8, 2025: Final deadline for qualified bids
- December 10, 2025: Auction at Capstone Capital Markets' Chicago offices
- December 12, 2025: Court hearing for sale approval
- December 22, 2025: Outside closing deadline
Potential bidders must submit a good faith deposit equal to the higher of 5% of their total cash consideration or $1.5 million. The company has retained Capstone Capital Markets LLC as its investment banker to manage the sale process.
Stalking Horse Provisions
The court filing contemplates the possibility of designating one or more "stalking horse" bidders who would establish a floor price for the auction. Such arrangements could include break-up fees and expense reimbursements to compensate unsuccessful stalking horse bidders, though any such protections would require separate court approval.
Wells Fargo maintains significant leverage in the process, with the right to submit credit bids for assets securing its loans and automatic qualification as a bidder without meeting standard requirements imposed on other potential purchasers.
Operational Continuity
CTL-Aerospace continues operating as a debtor-in-possession under Chapter 11 protection, with no trustee or examiner appointed. An unsecured creditors' committee has been formed to represent the interests of general creditors in the case.
The company's motion emphasizes that the asset sale represents "the best opportunity to realize value on a going concern basis" and avoid the decline and devaluation that would result from a prolonged bankruptcy process. The filing indicates that interested parties have already been provided access to an online data room containing substantial due diligence information.
Legal Framework
The motion seeks approval under Section 363 of the Bankruptcy Code, which allows debtors to sell assets outside the ordinary course of business with court approval. The proposed sale would transfer assets "free and clear" of most liens and claims, with those interests attaching to sale proceeds instead of the assets themselves.
Coolidge Wall Co., L.P.A., with attorneys Patricia J. Friesinger and Briana C. Breault representing the debtor, filed the 108-page motion on October 9, 2025. The case is assigned to Judge Beth A. Buchanan in the Western Division of the Southern District of Ohio bankruptcy court.
The motion also seeks authority to assume and assign certain executory contracts and unexpired leases as part of any asset sale, with procedures established for determining cure amounts owed to counterparties and resolving any disputes.
This article was prepared using Stretto Conductor, our new AI-powered assistant that's here to help. Stretto Conductor was able to create this summary of a 108 page court filing in less than a minute. Always review the underlying docket filings for accurate information. The information and responses generated by Stretto Conductor may contain errors or inaccuracies and should not be relied upon as a substitute for professional or legal advice.