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FLYi flies for bankruptcy (Chp. 11)

iaflyer

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http://biz.yahoo.com/prnews/051107/nym176.html?.v=27

DULLES, Va., Nov. 7 /PRNewswire-FirstCall/ -- FLYi, Inc., parent of low-fare airline Independence Air, today announced that FLYi, Inc. and its subsidiaries (the "company") including Independence Air, have filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in order to restructure the company's aircraft leases and other obligations to achieve necessary cost savings.

The company also announced it will request court approval to engage in a formal court-supervised auction process to seek outside investor(s) or purchaser(s) it needs to continue its operations. If the process is successful, it is expected to be concluded within the next sixty days. Those who have expressed interest during previous discussions, as well as new parties, will be invited to present their bids. Bidders will be permitted to demonstrate their interest in investing in the company, or to bid on all or portions of the company's assets. The company currently anticipates that it has the financial resources to fund its obligations-including the payment of employee wages and benefits-during the process.

As it undertakes the auction process, Independence Air plans to continue serving customers, and to continue its flight schedules in the ordinary course of business. The company plans to honor reservations and tickets on Independence Air and to allow its 1,000,000+ iCLUB(SM) members to continue to accrue and redeem points on the airline with no restrictions. The company has no plans to make any additional changes to its operating schedule or route map of destinations at this time. Independence Air now offers approximately 220 daily departures to 36 destinations.

"After careful consideration, we have concluded that a court-supervised restructuring will allow us to complete our cost-savings initiatives while seeking outside investors or purchasers, and represents the best solution for Independence Air, our customers, employees, creditors and the communities we serve," said Kerry Skeen, Chairman and CEO of FLYi, Inc.
 

WhiteCloud

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iaflyer said:
The company also announced it will request court approval to engage in a formal court-supervised auction process to seek outside investor(s) or purchaser(s) it needs to continue its operations. If the process is successful, it is expected to be concluded within the next sixty days.
Sounds fishy to me. I thought we had auctions when assets were being sold off. Are they going to sell the assets and then rent/contract them from these "investors?"
 

Peleton

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My best guess is they have an investor lined up already after they get some costs under control. They have 60 days to get the contracts admended and then they will put themselves up for sale to an investor.

They must have a deal lined up or why even try to file 11? If they have no potential investor lined up they should have continued until 7 is the only choice in the matter.

Just thinking outloud....

JM hows Pinnacle?
 

On Your Six

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Nice timing - the new Chapter 11 rules commenced a few weeks ago. Why delay to a point when the rules will be less favorable to your situation? It doesn't make a lot of sense....

Good luck to all involved!
 

"GO AROUND"

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Cause a few weeks ago the didn't even have enough money to file Chap 11. Makes you wonder if they do have investors lined up?
 

Ex737Driver

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Are you referring to the new rules that only allow for a company bankruptcy to be limited to 18 months or less, or are there additional new rules that apply? The only reason I could see to do this before the law change only applied to UAL. They appear to be the only company to milk the bankruptcy process. Quite possibe Independence will be out of BK before UAL anyway.
 

WhiteCloud

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BeCareful! said:
They are being bought by Air Wisconsin.
Interesting thought? They could use some office space out here and some infrastructure. CRJ parts? My guess is that if they are interested in anything with INDY it has to do with assets and not the airline.
 

Kenny

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BeCareful! said:
Oh, it's happening......trust me.

OK, I'll bite.......Why?

Explain how it would make any sense for AWAC to buy Indy and what they could possibly hope to achieve?
 

J32driver

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AWAC could get the remaining 50 seaters for pennies! They can then dump some of ours and replace them with airplanes that cost them next to nothing to get a hold of. That scenario would save AWAC on monthly costs. Other than flying different tail numbers, the pilots would see no change.

**WARNING**
[The above statement is in no way rooted in facts. It is pure personal speculation on a highly improbably scenario that may or may not happen. Past performance is in no way a guarentee of future gains.]
 

Dave Benjamin

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Best of luck to those at FlyI. I've met several of you over the years and had some jumpseat with us. Let's hope this works out satisfactorily one way or the other. ACA/FlyI has a pilot group that deserves far better than the hand they've been dealt.
 

flyer172r

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GO AROUND said:
Cause a few weeks ago the didn't even have enough money to file Chap 11. Makes you wonder if they do have investors lined up?

Ummm, how do you not have enough money to file bankruptcy? I thought the point of bankruptcy was that you had no money. Seriously, someone please explain because I do not understand that.
 

PoorJetDriver

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It is very expensive to operate in bankruptcy. Attorney's fees etc... Without any new financing there will be no exit from bankruptcy.
 

CFIse

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J32driver said:
AWAC could get the remaining 50 seaters for pennies! They can then dump some of ours and replace them with airplanes that cost them next to nothing to get a hold of. That scenario would save AWAC on monthly costs. Other than flying different tail numbers, the pilots would see no change.

OK - I'll bite - where do they "dump" the high priced jets?

I agree - there's going to be a glut of 50 seaters, but the only people who can "dump" their existing leases are those in bankruptcy - ooooh, there's a thought, AWAC declares backruptcy - remember, you heard it here first!
 

JetLinkin Park

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As someone posted elsewhere. The reason FLYi didn't file Bk prior to the law change is because the law only "hurts" companies who plan to re-emerge.

Think about it.
 

DO-82 driver

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Sorry to hear about your trouble guys...been there twice actually. Hope things work out for you all.....

Sincerely, a Netjets guy
 
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