Big change between ABX and DHL

[shooter]

http://moneycentral.msn.com/investor/sec/filing.asp?Symbol=ATSG


So, from what I can see the money ABX was to get from a put agreement from DHL to convert 767's to freighter is no more. The note in the filing shows a huge reduction in debt, much of which is forgiven from DHL, and the cash payment from the put.

So what gives? Does this mean they are not going to convert to freighters any longer? If so, why? Does anyone think there is now business for the PC's in a new DHL model? I see no other reason to not convert them with the put cash they said they would do unless they now have income generated by the PC's. But it could be just wishful thinking on my part.

 

[shooter]

And the negotiation tit-for-tat continues....for another month concerning these additional aircraft anyhow.

EDIT: I do like the length of the agreement. Starts in 2010 when the current ACMI expires and runs 5 years to 2015. I don't like the April 10, 2009 decision date though.

The MOU grants DHL options to lease from ABX Air, or an affiliate, four Boeing 767-200SF (freighter configuration) aircraft under favorable rates and for terms beginning August 15, 2010, and continuing through 2015. In exchange, DHL has agreed to assume financial responsibility, retroactive to January 31, 2009, for ABX Air’s obligations under capital leases on five Boeing 767-200PC (non-standard cargo door configuration) aircraft currently dedicated to DHL’s U.S. network. As of December 31, 2008, ATSG’s balance sheet reflected $52.8 million of debt and $22.2 million of net book value related to those aircraft capital leases. ABX Air will grant DHL up to $10 million of credit on extinguishment of the capital leases against future rent obligations for the four 767-200SFs. If DHL elects not to exercise its options for any of the four 767-200SFs, ABX Air would pay DHL $2.5 million.

ABX Air is expected to continue to operate some or all of the five 767-200PCs as required under the current ACMI Agreement between the companies. The MOU contains no stipulation, however, that ABX Air continues to be the operator of the four 767-200SF aircraft beyond those contained in the ACMI Agreement. The MOU will expire on April 10, 2009, unless executed or extended by that date.

http://www.businesswire.com/portal/...d=news_view&newsId=20090318005872&newsLang=en

 

[penguin22]

Know why the stock's up 50% on the news??? You won't find the reason in the press release. For some reason I guess Joe didn't want it mentioned in there

But it's in the 8-K. DHL has lifted the ban on buying back stock, and importantly (to Joe), lifted the ban on paying a dividend.
[FONT=&quot]http://biz.yahoo.com/e/090318/atsg8-k.html[/FONT]


Hete's the biggest individual shareholder. When ATSG announces they're paying the stockholders a dividend, he'll be the biggest individual benefactor. So now we know why he's been buying up stock all this time.

The morbid amongst us may speculate that he'll declare a one time dividend to get as much $$$ out of the company as possible, before he has to turn the remaining assets over to creditors in a bankruptcy if/when DHL leaves