Western Global Airlines LLC founder and Chief Executive Officer Jim Neff bought the cargo airline’s deeply distressed secured debt as the company veers toward a Chapter 11 bankruptcy filing, according to people with knowledge of the matter. 

The move comes just three years after Western Global raised $400 million in a bond deal that handed Neff a payout as part of a minority stake sale to employees. Neff still owns more than 60% of the company, one of the people said.

A representative for Western Global declined to comment.

The company has been weighing a bankruptcy filing as it faces dwindling liquidity, Bloomberg previously reported. Neff’s plan would be to keep Western Global as a going concern as it seeks to restructure its debt load, the people familiar with the matter said.

The company began confidential talks with some of its creditors related to its financing needs last month, Bloomberg reported. Amid those talks, Truist Financial Corp. sought to sell the company’s first-lien term loan and revolver and accepted a bid of about 40 cents on the dollar, the people said.

A representative for Truist declined to comment.

After Neff’s purchase of the senior debt, some of the investors who bought Western Global’s bonds in 2020 — who now sit behind Neff in line for repayment — are examining if such a purchase could be considered fraudulent if the company files for bankruptcy, said the people, who asked not to be named because the matter is private.