Avtek Signs Pact to Raise $55 Million for New Plane

The president of Avtek Corp., a Camarillo firm developing a corporate airplane made mostly of plastic composites, said Monday that a foreign investment firm agreed to try to raise the $55 million Avtek needs to test and produce its plane.

Gulf Development Co., a London-based firm that principally invests money for Middle East interests, signed the agreement with Avtek on June 1, Avtek President Robert Adickes said in a telephone interview.

Avtek was under pressure to reach the agreement by June 1. After that day, the government of Finland could have exercised an option it owns to acquire 80% of Avtek in exchange for providing the money needed to complete testing of the Avtek aircraft.

Because of the Gulf Development accord, however, Finland extended that deadline to July 31, Adickes said. And if Gulf Development raises the money by July 31, Finland’s option will simply expire, said Adickes, whose family owns about 65% of Avtek.

Gulf Development also will obtain an as yet undetermined ownership stake in Avtek if it raises the money, Adickes added.

Avtek has a prototype of its plane, but now needs about $25 million to pay for testing required by the Federal Aviation Administration. The other $30 million would be used to build a plant to manufacture the aircraft, which is expected to seat six to 10 passengers, reach speeds up to 400 m.p.h. and cost $1.75 million.