Dizel8
Douglas metal
- Joined
- Feb 27, 2003
- Posts
- 2,817
This news was posted on Yahoo, could have been seen before. I remember Tilton saying, that UAL would come out of Ch.11 some time late summer, with or without the goverment guarantee, well, once again, they are seeking extensions as they try to get the plan together. Sadly, the PBGC appears to be cognizant of where this might be going!
"The company also received another 30-day extension to file its reorganization plan but said it will likely seek a "multi-month" extension in August.
United was denied a $1.1 billion government loan guarantee last month, forcing it to restructure plans for securing bankruptcy exit financing and putting immediate pressure on the Elk Grove, Illinois-based company to reduce ballooning pension costs.
United has four employee pension plans which now are underfunded by about $4.1 billion over the next five years.
"Because United's existing pension funding obligations will remain a huge financial burden after exit, it is incumbent on United to study all possible options and to determine whether United can sustain this burden and still attract exit financing," the company said in an update to the court on its reorganization.
Randy Clerihue, a spokesman for the Pension Benefit Guaranty Corp., the federal agency that insures corporate pensions, said it was rare for bankrupt companies that skip contributions to make up the shortfall. "Obviously it heightens concern," Clerihue said. "It's not a foregone conclusion that plans terminate, but we don't often see those plans riding through without those shortfalls corrected.""
"The company also received another 30-day extension to file its reorganization plan but said it will likely seek a "multi-month" extension in August.
United was denied a $1.1 billion government loan guarantee last month, forcing it to restructure plans for securing bankruptcy exit financing and putting immediate pressure on the Elk Grove, Illinois-based company to reduce ballooning pension costs.
United has four employee pension plans which now are underfunded by about $4.1 billion over the next five years.
"Because United's existing pension funding obligations will remain a huge financial burden after exit, it is incumbent on United to study all possible options and to determine whether United can sustain this burden and still attract exit financing," the company said in an update to the court on its reorganization.
Randy Clerihue, a spokesman for the Pension Benefit Guaranty Corp., the federal agency that insures corporate pensions, said it was rare for bankrupt companies that skip contributions to make up the shortfall. "Obviously it heightens concern," Clerihue said. "It's not a foregone conclusion that plans terminate, but we don't often see those plans riding through without those shortfalls corrected.""
