The trading operation of Melbourne-based drone logistics operator Swoop Aero may have been insolvent for at least three months prior to the appointment in October of a voluntary administrator, who has recommended the company be wound up amidst a negative net trading position that is eating into funds available for creditors.

Creditors will decide on the matter at afternoon meetings for the company and its parent Kookaburra Aerospace next Tuesday, 19 November.

Merchant banking group Iridium Private has shown interest in the company, but administrator Simon Nelson of BPS Reconstruction and Recovery warns its advised 60-day timeframe for a transaction "may not be feasible given the circumstances".

The creditors' report for Swoop Aero Pty Ltd adds that indicative non-binding offers have also been received and shortlisted.

Nelson cites a number of cash flow issues at the company since his appointment, with a trading profit of $283,000 outweighed by trading liabilities of $311,000 that remained unpaid when the report was released on 11 November.

With the company's finances going backwards, a sales process ongoing, and a substantial portion of its assets tied up in a stock of completed drones whose value depends largely on Swoop's technology and operating systems, the recommendation is that the business be liquidated.