Lilium’s principal German subsidiaries will apply for self-administration proceedings in the next few days with the competent court in Germany.
This follows a lengthy and complex government approval process for a loan from KfW, which failed in the Budget Committee of the German parliament.
Lilium’s international competition is receiving grants and loans in the U.S., France, China, Brazil, and the UK. Therefore, German government support was seen by Lilium investors as critical to retain market confidence and potential future investment.
Lilium CEO Klaus Roewe said; “Our plan was to obtain shareholder investment in a new funding round anchored by a German government backed loan of €100 million.
“We had already conditionally secured additional private capital to complement the KfW loan. However, the Budget Committee was unable to agree on the loan and Bavaria couldn’t do it alone.”
According to Lilium, the German government support of the KfW loan was a closing condition to already committed private funding and without this support the company was left with no alternative but to cause the principal German subsidiaries to file for self-administration.
Lilium was also in advanced discussions regarding a French government guarantee of a €219 million loan to finance a battery factory and an assembly line in the Southwest of France. Following the Lilium Jet’s planned first flight in early 2025, Lilium anticipated receiving pre-delivery payments and new investment to finance the company into 2026 when the company expected delivery would begin on its current order pipeline consisting of firm orders, reservations, options, and memoranda of understanding for more than 780 Lilium Jets to operators in the U.S., South America, Europe, Asia, and the Middle East.
Self-administration, if and when granted by the court, aims to preserve and continue the business that is the subject of the proceedings. Management would retain control and would continue operating the business under the supervision of a custodian. The procedure is often used to initiate investment by new parties or a process to sell the company’s assets and/or business as a whole. In Germany, the procedure is generally perceived as providing an improved chance for a successful in-court business restructuring.
Klaus Roewe said; “We deeply regret the insolvency and its consequences for all stakeholders at such a crucial stage of our company’s development.
“However, while there is no guarantee for success in insolvency proceedings, we hope that the Lilium Jet will get a chance for a fresh start after the self-administration process is completed.”
“We strongly believe that electric flying is our best hope for the decarbonization of aviation,” Klaus Roewe added.
