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US Airways catches a break!

boscenter

DC-9 Evangelist
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Dec 12, 2001
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Today is a good news day... with the guns resolution in the house, and now this...

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US Airways gets conditional approval of loan application

WASHINGTON, July 10 (Reuters) - The Bush administration granted conditional approval late on Wednesday to a $900 million loan guarantee application from US Airways.

The Air Transportation Stabilization Board, set up after the Sept. 11 hijack attacks to help struggling airlines get back on their feet financially, said US Airways (NYSE:U - News) must nail down concessions from its unions, and give the government a greater stake in the carrier than it has already been offered.

US Airways had repeatedly warned if it could not cut enough fat to win approval of the petition for loan guarantees, it might have to file for bankruptcy.

The airline lost a net $2.1 billion in 2001 and $269 million in the first quarter.

Analysts have said US Airways is looking to get cost reductions from its workers by July 16 when a grace period on some of its defaults expires. That could push the company into bankruptcy.
 

Tim47SIP

Serving for the USofA
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Wolf's Plan?

I personally think that Wolf's plan is to secure the loan and go into forced Ch11 as he has stopped payment on several aircraft leases and loans. By doing this, if they aren't paid by the 16th (manditory grace period), these companies can force U into CH11. That way, he can go into restructuring un impeded by the unions and creditors. Any thoughts?:rolleyes:

Re-edited as I cant see or spell!
 
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boscenter

DC-9 Evangelist
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Dec 12, 2001
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Yeah, I don't know... I think a bankruptcy judge would have to evaluate that situation... And, if I were one, I'd be looking over it extra close considering they just got $900mil of taxpayer money.

Maybe they'll try, but no one in their right mind would let them pull that one, esp. given the current temperment and lack of trust in light of WorldCom and Enron.

Wouldn't put it past him though!! :eek:
 

TMMT

Well-known member
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Jun 25, 2002
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Didn't someone do something similar to Continental awhile back... years back?

TMMT
 

Tim47SIP

Serving for the USofA
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Hey Guy's

Remember that it is not "taxpayers money" untill they default. The Gov is only backing the loans. Private institutions like Bof A, etc. will fund the money. I personally hope they choose wisely.:eek:
 
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