• NC Software is proud to announce the release of APDL - Airline Pilot Logbook version 10.0. Click here to view APDL on the Apple App store and install now.

Delta filed for Chap 11 (merged thread)

RichO

Well-known member
Joined
Feb 15, 2002
Posts
377
Total Time
enough
*WSJ: Delta Seeks Protection In NY Bankruptcy Court

09/14/2005
Dow Jones News Services
(Copyright © 2005 Dow Jones & Company, Inc.)




(MORE TO FOLLOW) Dow Jones Newswires
 

General Lee

Well-known member
Joined
Aug 24, 2002
Posts
20,442
Total Time
A lot
Delta filed for Chap 11

CNBC just reported it. 1645 local. Time to restructure, and I guess that means more pay cuts etc.........And maybe a merger with NW? We'll see.


Bye Bye--General Lee
 

Dav8tor

Well-known member
Joined
Jan 29, 2002
Posts
131
Total Time
8600+
Delta files for Bankrupcy according to CNBC.

CNBC reports just recently that Delta files for Bankruptcy protection. Hope the best for everyone involved and a quick return to profitability.
 

RichO

Well-known member
Joined
Feb 15, 2002
Posts
377
Total Time
enough
*DJ Delta Air Lines Confirms Filing For Chapter 11 >DAL

09/14/2005
Dow Jones News Services
(Copyright © 2005 Dow Jones & Company, Inc.)



(MORE TO FOLLOW) Dow Jones Newswires

09-14-05 1653ET

Copyright (c) 2005 Dow Jones & Company, Inc.

*DJ Delta Air Arranging $2.05B Post-Petition Financing >DAL



(MORE TO FOLLOW) Dow Jones Newswires

09-14-05 1654ET

Copyright (c) 2005 Dow Jones & Company, Inc.

*DJ Delta Air Lines Expects To Continue Normal Business Ops



(MORE TO FOLLOW) Dow Jones Newswires

09-14-05 1655ET

Copyright (c) 2005 Dow Jones & Company, Inc.

*DJ Delta Air Lines Sees Further Job Cuts >DAL



(MORE TO FOLLOW) Dow Jones Newswires

09-14-05 1655ET

Copyright (c) 2005 Dow Jones & Company, Inc.

*DJ Delta Air Lines Sees Changes To Employee Pay, Benefits



(MORE TO FOLLOW) Dow Jones Newswires

09-14-05 1656ET

Copyright (c) 2005 Dow Jones & Company, Inc.

*DJ Delta Air To Remove 4 Aircraft Types By The End Of '06



(MORE TO FOLLOW) Dow Jones Newswires

09-14-05 1656ET

Copyright (c) 2005 Dow Jones & Company, Inc.

*DJ Delta Air Lines To Deploy Smaller Aircraft On Many Routes



(MORE TO FOLLOW) Dow Jones Newswires

09-14-05 1656ET

Copyright (c) 2005 Dow Jones & Company, Inc.
 

Dav8tor

Well-known member
Joined
Jan 29, 2002
Posts
131
Total Time
8600+
Delta Air Lines Files For Chapter 11 Reorganization to Address Financial Challenges

ATLANTA, Sept. 14, 2005, Sep 14, 2005 (PRIMEZONE via COMTEX) -- Delta and Subsidiaries Will Continue to Operate Full Flight Schedule, Honor Tickets and Reservations, Maintain SkyMiles Program, and Provide Pay and Benefits to Employees Company Arranging $2.05 Billion In Post-Petition FinancingDelta Air Lines (DAL) today announced that to address its financial challenges and support its ongoing efforts to become a simpler, more efficient and cost-effective airline, the company and its subsidiaries have filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code.

Delta's Board of Directors, in a unanimous decision, directed the company to take this action after determining that a Chapter 11 reorganization is in the best long-term interest of the company, its employees, customers, creditors, business partners and other stakeholders.

Delta expects to continue normal business operations today and throughout the reorganization process. Specifically, it expects to continue to:

-- Operate its full schedule of flights worldwide; -- Honor tickets and reservations and provide refunds and exchanges as usual; -- Maintain the SkyMiles program and other customer service programs; -- Provide amenities like Crown Room Clubs and international lounges in select cities; -- Provide employee wages, healthcare coverage, vacation, sick leave and similar benefits without interruption; and, -- Pay suppliers for goods and services received during the reorganization process."The action we have taken is a necessary and responsible step to preserve Delta's value for our creditors, customers, employees, business partners and other stakeholders as we address our financial challenges and work to secure our future," said Delta CEO Gerald Grinstein. "Delta is open for business as usual and will continue normal operations throughout the reorganization process. Our customers can be confident that they remain our number one priority and that their travel plans and SkyMiles are secure."

To help support its business during the Chapter 11 proceedings, Delta has obtained a commitment for $1.7 billion in debtor-in-possession (DIP) financing from GE Commercial Finance and Morgan Stanley as Co-Lead Arrangers. The commitment includes up to $1.4 billion of financing on an interim basis pending final approval of the full DIP financing at a later date.

In addition to the commitment for the new $1.7 billion DIP financing, which replaces approximately $980 million in secured pre-petition financing from GE Commercial Finance and American Express, Delta has an agreement in principle with American Express to provide the airline with an additional $350 million of secured financing. Altogether, Delta's post-petition financing arrangements now total up to $2.05 billion, an increase of approximately $1.07 billion from the company's pre-petition secured credit facilities.

During the last year, Delta has developed and implemented a transformation plan aimed at achieving approximately $5 billion in annual financial benefits by the end of 2006 as compared to 2002. As of June 30, 2005, Delta had implemented initiatives intended to achieve approximately 85 percent of these benefits and was ahead of schedule to meet its target. However, persistent record-high fuel costs at unpredicted and unprecedented levels and the continued downward pressure on revenues within the airline industry substantially outpaced and masked these benefits. Despite doing everything it could to preserve its liquidity, Delta has determined that it has no alternative but to utilize the protections and flexibilities provided by the U.S. bankruptcy laws. Delta intends to use the additional time and flexibility provided by the Chapter 11 process to expand its transformation plan and move the company toward a more secure future.

"Delta's financial problems are severe, but by no means insurmountable," Mr. Grinstein said. "We are optimistic about our future because we have been working for months on a business plan that builds on the substantial improvements we've already made and demonstrates that Delta can return to profitability once the company is able to restructure appropriately."

Delta understands that any cost savings that it is able to achieve while in Chapter 11 must fit within the strategic context of a sensible business plan that remakes the airline into a profitable company. Delta has made great strides over the last few years to adapt itself to the new competitive environment, undertaking major cost-cutting initiatives and massive network, scheduling and operational improvements -- without adversely impacting its customer service rankings. As part of these efforts to improve efficiency and bottomline results, Delta undertook the largest single-day schedule restructurings in its history, including the redesign of the Atlanta hub operation and the elimination of its hub operation at Dallas/Ft. Worth airport. The airline also restructured its domestic fare system with industry-leading "Simplifares," rolled out extensive new customer-focused airport technology, and outsourced a significant portion of its heavy maintenance, among other steps. Delta's in-court business plan builds on these achievements and on its competitive strengths and is designed to return the carrier to profitability.

Delta plans to use Chapter 11 to reconfigure its fleet and network footprint in a manner that will enhance its revenues. First, Delta plans to simplify and streamline its fleet by targeting four aircraft types to be removed by the end of 2006, so that only seven mainline aircraft types will remain. Second, Delta plans to deploy smaller aircraft on many of its routes so that it utilizes the proper-sized aircraft for the route it is flying. Third, Delta will continue to right-size its hub operations. Fourth, Delta plans to increase its capacity on international routes with greater profit potential.

In addition to these substantial network and operational improvements, Delta has determined that further job reductions and changes to employee pay and benefits are a necessary component of its business plan. "Any changes in pay and benefits will be in the context of a comprehensive business plan that is equitable and involves other Delta stakeholders," said Grinstein. "Importantly, Delta people at every level and across all work groups also will have a greater ability than they do now to benefit from our financial recovery and operational excellence," he added. The company said it will be communicating to employees more details about these changes as early as next week.

On September 12, Delta presented the union that represents Delta pilots, the Air Line Pilots Association (ALPA), with pilot cost-saving proposals necessary to help address the company's severe challenges.

Given its financial situation and the need to preserve as much cash as possible for its operations, Delta does not plan to make the qualified defined benefit plan funding contributions soon due. "Missing contributions does not mean that our qualified plans stop paying monthly retirement benefits or that we have initiated the process to terminate the plans," Grinstein said.

The company is continuing to pursue pension reform legislation that might make the plans more affordable. However, because of Delta's growing financial pressures, there can be no guarantees -- even with pension reform -- about the future of Delta's qualified defined benefit pension plans. "Ultimately, what we can afford in the future airline business environment, as well as the nature of any legislation, will determine what is possible," Grinstein asserted.

He added, "As we deal with our financial challenges, it is important to keep in mind that Delta -- the world's second-largest passenger airline, the leading U.S. carrier across the Atlantic and the third-largest carrier to Latin America -- has formidable strengths: Delta people and the customer loyalty their superior service inspires; the significant network advantages derived from having the world's largest hub (in Atlanta), supported by our hubs in Cincinnati, Salt Lake City, New York-JFK and many focus cities; Song -- our award-winning, low-fare air service; and Delta's cutting-edge, passenger-friendly technology are but a few of our distinguishing assets."

He concluded, "As Delta rises to meet new challenges, I am certain some things will never change. Our resolve to keep flying while upholding the highest standards of safety and service will not falter. Our commitment to the principle that Delta people will share in any success their sacrifice helps make possible will not waver. Our gratitude for the loyalty of our customers and the support of the communities we serve will not subside. And, our pride in this great company and in one another will not be shaken."
 

Mmmmmm Burritos

Where mah dogs at?
Joined
Nov 21, 2003
Posts
323
Total Time
Lies!!
Man, they really need to update their file footage for Delta. All they show are 727s and MD-11s!
 

RichO

Well-known member
Joined
Feb 15, 2002
Posts
377
Total Time
enough
*DJ Delta Air Lines Confirms Filing For Chapter 11 >DAL

09/14/2005
Dow Jones News Services
(Copyright © 2005 Dow Jones & Company, Inc.)



(MORE TO FOLLOW) Dow Jones Newswires

09-14-05 1653ET

Copyright (c) 2005 Dow Jones & Company, Inc.

*DJ Delta Air Arranging $2.05B Post-Petition Financing >DAL



(MORE TO FOLLOW) Dow Jones Newswires

09-14-05 1654ET

Copyright (c) 2005 Dow Jones & Company, Inc.

*DJ Delta Air Lines Expects To Continue Normal Business Ops



(MORE TO FOLLOW) Dow Jones Newswires

09-14-05 1655ET

Copyright (c) 2005 Dow Jones & Company, Inc.

*DJ Delta Air Lines Sees Further Job Cuts >DAL



(MORE TO FOLLOW) Dow Jones Newswires

09-14-05 1655ET

Copyright (c) 2005 Dow Jones & Company, Inc.

*DJ Delta Air Lines Sees Changes To Employee Pay, Benefits



(MORE TO FOLLOW) Dow Jones Newswires

09-14-05 1656ET

Copyright (c) 2005 Dow Jones & Company, Inc.

*DJ Delta Air To Remove 4 Aircraft Types By The End Of '06



(MORE TO FOLLOW) Dow Jones Newswires

09-14-05 1656ET

Copyright (c) 2005 Dow Jones & Company, Inc.

*DJ Delta Air Lines To Deploy Smaller Aircraft On Many Routes



(MORE TO FOLLOW) Dow Jones Newswires

09-14-05 1656ET

Copyright (c) 2005 Dow Jones & Company, Inc.
 

kngarthur

Well-known member
Joined
Oct 26, 2004
Posts
348
Total Time
1850
miles otoole said:
Wonder if there will be an international fare sale to kick off the announcement.


Who's next? NWA or FLYI? Any wagers?
 

Plug

Well-known member
Joined
Dec 23, 2004
Posts
465
Total Time
10000+
ATLANTA, Sept. 14, 2005 (PRIMEZONE) -- Delta Air Lines (NYSE:DAL - News) today announced that to address its financial challenges and support its ongoing efforts to become a simpler, more efficient and cost-effective airline, the company and its subsidiaries have filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code.

Delta's Board of Directors, in a unanimous decision, directed the company to take this action after determining that a Chapter 11 reorganization is in the best long-term interest of the company, its employees, customers, creditors, business partners and other stakeholders.

Delta expects to continue normal business operations today and throughout the reorganization process. Specifically, it expects to continue to:


-- Operate its full schedule of flights worldwide;

-- Honor tickets and reservations and provide refunds and exchanges
as usual;

-- Maintain the SkyMiles program and other customer service
programs;

-- Provide amenities like Crown Room Clubs and international lounges
in select cities;

-- Provide employee wages, healthcare coverage, vacation, sick leave
and similar benefits without interruption; and,

-- Pay suppliers for goods and services received during the
reorganization process.

ADVERTISEMENT


``The action we have taken is a necessary and responsible step to preserve Delta's value for our creditors, customers, employees, business partners and other stakeholders as we address our financial challenges and work to secure our future,'' said Delta CEO Gerald Grinstein. ``Delta is open for business as usual and will continue normal operations throughout the reorganization process. Our customers can be confident that they remain our number one priority and that their travel plans and SkyMiles are secure.''

To help support its business during the Chapter 11 proceedings, Delta has obtained a commitment for $1.7 billion in debtor-in-possession (DIP) financing from GE Commercial Finance and Morgan Stanley as Co-Lead Arrangers. The commitment includes up to $1.4 billion of financing on an interim basis pending final approval of the full DIP financing at a later date.

In addition to the commitment for the new $1.7 billion DIP financing, which replaces approximately $980 million in secured pre-petition financing from GE Commercial Finance and American Express, Delta has an agreement in principle with American Express to provide the airline with an additional $350 million of secured financing. Altogether, Delta's post-petition financing arrangements now total up to $2.05 billion, an increase of approximately $1.07 billion from the company's pre-petition secured credit facilities.

During the last year, Delta has developed and implemented a transformation plan aimed at achieving approximately $5 billion in annual financial benefits by the end of 2006 as compared to 2002. As of June 30, 2005, Delta had implemented initiatives intended to achieve approximately 85 percent of these benefits and was ahead of schedule to meet its target. However, persistent record-high fuel costs at unpredicted and unprecedented levels and the continued downward pressure on revenues within the airline industry substantially outpaced and masked these benefits. Despite doing everything it could to preserve its liquidity, Delta has determined that it has no alternative but to utilize the protections and flexibilities provided by the U.S. bankruptcy laws. Delta intends to use the additional time and flexibility provided by the Chapter 11 process to expand its transformation plan and move the company toward a more secure future.

``Delta's financial problems are severe, but by no means insurmountable,'' Mr. Grinstein said. ``We are optimistic about our future because we have been working for months on a business plan that builds on the substantial improvements we've already made and demonstrates that Delta can return to profitability once the company is able to restructure appropriately.''

Delta understands that any cost savings that it is able to achieve while in Chapter 11 must fit within the strategic context of a sensible business plan that remakes the airline into a profitable company. Delta has made great strides over the last few years to adapt itself to the new competitive environment, undertaking major cost-cutting initiatives and massive network, scheduling and operational improvements -- without adversely impacting its customer service rankings. As part of these efforts to improve efficiency and bottomline results, Delta undertook the largest single-day schedule restructurings in its history, including the redesign of the Atlanta hub operation and the elimination of its hub operation at Dallas/Ft. Worth airport. The airline also restructured its domestic fare system with industry-leading ``Simplifares,'' rolled out extensive new customer-focused airport technology, and outsourced a significant portion of its heavy maintenance, among other steps. Delta's in-court business plan builds on these achievements and on its competitive strengths and is designed to return the carrier to profitability.

Delta plans to use Chapter 11 to reconfigure its fleet and network footprint in a manner that will enhance its revenues. First, Delta plans to simplify and streamline its fleet by targeting four aircraft types to be removed by the end of 2006, so that only seven mainline aircraft types will remain. Second, Delta plans to deploy smaller aircraft on many of its routes so that it utilizes the proper-sized aircraft for the route it is flying. Third, Delta will continue to right-size its hub operations. Fourth, Delta plans to increase its capacity on international routes with greater profit potential.

In addition to these substantial network and operational improvements, Delta has determined that further job reductions and changes to employee pay and benefits are a necessary component of its business plan. ``Any changes in pay and benefits will be in the context of a comprehensive business plan that is equitable and involves other Delta stakeholders,'' said Grinstein. ``Importantly, Delta people at every level and across all work groups also will have a greater ability than they do now to benefit from our financial recovery and operational excellence,'' he added. The company said it will be communicating to employees more details about these changes as early as next week.

On September 12, Delta presented the union that represents Delta pilots, the Air Line Pilots Association (ALPA), with pilot cost-saving proposals necessary to help address the company's severe challenges.

Given its financial situation and the need to preserve as much cash as possible for its operations, Delta does not plan to make the qualified defined benefit plan funding contributions soon due. ``Missing contributions does not mean that our qualified plans stop paying monthly retirement benefits or that we have initiated the process to terminate the plans,'' Grinstein said.

The company is continuing to pursue pension reform legislation that might make the plans more affordable. However, because of Delta's growing financial pressures, there can be no guarantees -- even with pension reform -- about the future of Delta's qualified defined benefit pension plans. ``Ultimately, what we can afford in the future airline business environment, as well as the nature of any legislation, will determine what is possible,'' Grinstein asserted.

He added, ``As we deal with our financial challenges, it is important to keep in mind that Delta -- the world's second-largest passenger airline, the leading U.S. carrier across the Atlantic and the third-largest carrier to Latin America -- has formidable strengths: Delta people and the customer loyalty their superior service inspires; the significant network advantages derived from having the world's largest hub (in Atlanta), supported by our hubs in Cincinnati, Salt Lake City, New York-JFK and many focus cities; Song -- our award-winning, low-fare air service; and Delta's cutting-edge, passenger-friendly technology are but a few of our distinguishing assets.''

He concluded, ``As Delta rises to meet new challenges, I am certain some things will never change. Our resolve to keep flying while upholding the highest standards of safety and service will not falter. Our commitment to the principle that Delta people will share in any success their sacrifice helps make possible will not waver. Our gratitude for the loyalty of our customers and the support of the communities we serve will not subside. And, our pride in this great company and in one another will not be shaken.''

Delta's Chapter 11 cases were filed today in U.S. Bankruptcy Court for the Southern District of New York. Delta has filed a motion with the Court seeking interim relief that will ensure the company's continued ability to conduct normal operations. If such interim relief is granted by the Court, Delta will be authorized, among other things, to:


-- Provide employee wages, healthcare coverage, vacation, sick leave
and similar benefits without interruption.

-- Honor pre-petition obligations to customers and continue customer
programs including Delta's SkyMiles frequent-flyer program.

-- Pay for fuel under existing fuel supply contracts, and honor
existing fuel supply, distribution and storage agreements.

-- Assume contracts relating to interline agreements with other
airlines.

-- Pay pre-petition obligations to foreign vendors, foreign service
providers and foreign governments.

-- Continue maintenance of existing bank accounts and existing cash
management systems.

Delta's principal bankruptcy counsel is Davis Polk & Wardwell. Its financial adviser is the Blackstone Group.
 

lowecur

Well-known member
Joined
Sep 14, 2003
Posts
2,317
Total Time
na
Anti-climatic? Maybe not. Phil LeBeau on CNBC spoke to Leo Mullins at 5pm and asked him about a possible Chapt 11 liquidation. Of course Mullins pooh poohed that, and said they will continue to be an integral part of the transportation infrastructure.

LeBeau went on to explain that his sources tell him that a Chapt 11 liquidation(where individual parts are sold off until the company is either bought out, merged, or liquidated) is on the table. This is something that is entirely possible if DL is unable to see a viable return to profitability in Chapt 11 in the first year. Remember, DL has the use of only $700M of the $1.7B loan. That coupled with a smaller unstricted cash balance and the legal costs of Chapt 11, they are sitting on a do or die year ahead.
 

B-J-J Fighter

Royce Gracie in Action
Joined
Dec 1, 2001
Posts
1,118
Total Time
>4000
Do companies still sell stock if they are in BK? I'm wondering if you can pick it up dirt cheap (it's dirt cheap already) and if they get things together and it goes back to the $60 dollar range retire from flying altogether. I would buy a C340 and drive myself around the carribean 6 months per year.
 

General Lee

Well-known member
Joined
Aug 24, 2002
Posts
20,442
Total Time
A lot
Well, at least Grinstein seems think we will get through this. He stated 4 airplane fleets will be gone (732, 733, 73G-shuttle, and 762) by the END of 2006 (in time for Embraer to make some E190s). He also stated mor"smaller planes" will take over some mainline routes, but more INTL routes for some domestic 767s that can go INTL. Song will stay. I think a merger is in the works---and NW just filed too. Man alive.....


Bye Bye--General Lee
 

FlyingSig

Double Breasted _ _ _
Joined
Dec 1, 2001
Posts
560
Total Time
7000+
lowecur said:
Remember, DL has the use of only $700M of the $1.7B loan. That coupled with a smaller unstricted cash balance and the legal costs of Chapt 11, they are sitting on a do or die year ahead.

From an article I just read:
In addition to the commitment for the new $1.7 billion DIP financing, which replaces approximately $980 million in secured pre-petition financing from GE Commercial Finance and American Express, Delta has an agreement in principle with American Express to provide the airline with an additional $350 million of secured financing. Altogether, Delta’s post-petition financing arrangements now total up to $2.05 billion, an increase of approximately $1.07 billion from the company's pre-petition secured credit facilities.
 
Top