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US Airways, America West in talks-WSJ
Reuters
Sunday, May 15, 2005; 7:18 PM
PHILADELPHIA (Reuters) - US Airways Group Inc. <UAIRQ.OB> and America West Holdings Corp. <AWA.N>, which are in merger negotiations, are trying to raise up to $400 million in funding and secure a loan from Airbus in exchange for ordering new airplanes, according to The Wall Street Journal.
The two airlines are expected to announce their merger within the next week, an industry source previously told Reuters. That pact would likely begin as a marketing alliance and unfold in stages, the source said.
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The Wall Street Journal reported on Sunday that US Airways and America West have been in talks to gain new funding from Air Canada and two hedge funds. The carriers also may secure additional funds through a rights offering, the newspaper said in its electronic edition.
America West, based in Tempe, Arizona, and US Airways, based in Arlington, Virginia, could not be immediately reached for comment.
Air Canada's parent, ACE Aviation Holdings Inc. <ACErv.TO>, is in talks to invest up to $150 million in equity, the newspaper said. Hedge fund PAR Capital Management Inc., formerly a large stakeholder in America West, and a second hedge fund may provide another $125 million of equity.
In addition to that funding, the airlines are in negotiations to get a $250 million loan from aircraft-manufacturer Airbus in return for ordering about 20 new A350-model planes, the Journal reported.
General Electric Co. <GE.N>, the largest creditor to America West and US Airways, also is finalizing its own deal with the carriers to reduce its financial exposure by $1 billion, the newspaper reported. GE plans to cut off most of the regional-jet financing and take back more leased planes than previously expected.
Reuters
Sunday, May 15, 2005; 7:18 PM
PHILADELPHIA (Reuters) - US Airways Group Inc. <UAIRQ.OB> and America West Holdings Corp. <AWA.N>, which are in merger negotiations, are trying to raise up to $400 million in funding and secure a loan from Airbus in exchange for ordering new airplanes, according to The Wall Street Journal.
The two airlines are expected to announce their merger within the next week, an industry source previously told Reuters. That pact would likely begin as a marketing alliance and unfold in stages, the source said.
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The Wall Street Journal reported on Sunday that US Airways and America West have been in talks to gain new funding from Air Canada and two hedge funds. The carriers also may secure additional funds through a rights offering, the newspaper said in its electronic edition.
America West, based in Tempe, Arizona, and US Airways, based in Arlington, Virginia, could not be immediately reached for comment.
Air Canada's parent, ACE Aviation Holdings Inc. <ACErv.TO>, is in talks to invest up to $150 million in equity, the newspaper said. Hedge fund PAR Capital Management Inc., formerly a large stakeholder in America West, and a second hedge fund may provide another $125 million of equity.
In addition to that funding, the airlines are in negotiations to get a $250 million loan from aircraft-manufacturer Airbus in return for ordering about 20 new A350-model planes, the Journal reported.
General Electric Co. <GE.N>, the largest creditor to America West and US Airways, also is finalizing its own deal with the carriers to reduce its financial exposure by $1 billion, the newspaper reported. GE plans to cut off most of the regional-jet financing and take back more leased planes than previously expected.
