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Boeing Wants To Take Over Hawaiian  
User currently offlineKKMolokai From United States of America, joined Feb 2000, 760 posts, RR: 2
Posted (10 years 7 months 1 week 2 days 8 hours ago) and read 5179 times:

Posted at 10:47 a.m., Wednesday, February 11, 2004

Boeing Capital wants to take over Hawaiian Air

By Dan Nakaso
Advertiser Staff Writer

Boeing Capital Corporation, one of Hawaiian Airlines' largest creditors, proposed today to become part of a new investment group that would take over Hawai'i's largest airline and lead it out of bankruptcy protection, according to a reorganization plan submitted to the U.S. Bankruptcy Court.
The first of several expected reorganization plans was submitted by Boeing Capital Corp. and partners, Corporate Recovery Group, LLC, and BCC Equipment Leasing Corp. The partnership would provide Hawaiian Airlines with a capital infusion of $30 million.

The new management team would be led by Bruce Nobles, Hawaiian's CEO from June 1993 to March 1997, who helped lead the company out of its last bankruptcy reorganization.

Under the plan, existing equity securities would be cancelled. Employment, retirement and other agreements with Hawaiianâs directors, officers and employees — except for Hawaiian's pilot pension plan — would remain in place.

Small, unsecured claims would receive a cash distribution equal to 50 percent of the claims.

Larger unsecured claims will be compensated with subordinated notes, similar to a bond, or warrants, which can be converted into stock, backed by the new company. A third option for larger unsecured claims is to pay them off with proceeds from litigation, according to the plan.

"So the ability to exchange notes for the larger unsecured claims really sets this plan apart," Nobles said this morning. "Often creditors receive only stock in their reorganized company. These notes will be repaid at market rates, providing creditors with an attractive recovery that is higher than is customary in airline bankruptcies."

Boeing Capital is among Hawaiian’s largest creditors. It has 11 Boeing 717 and three Boeing 767-300 aircraft under long-term leases to Hawaiian.

Boeing and Hawaiian's bankruptcy trustee, Josh Gotbaum, have been negotiating new lease agreements, with the latest deadline set to expire this month.

"This plan contains mutually agreeable revisions to the Boeing aircraft leases, which will result in substantial cost savings to the airline and the continued availability of a new Boeing fleet," Nobles said.

Today's plan is the first of several expected to be filed by various interested parties, including Gotbaum, fomer Hawaiian CEO John Adams and a San Francisco investment group Vx Capital Partners. Any plan would have to be approved by federal bankruptcy Judge Robert Faris.



We are the people of American Airlines. And we know why you fly.
29 replies: All unread, showing first 25:
 
User currently offlineTheflcowboy From United States of America, joined Jan 2004, 405 posts, RR: 0
Reply 1, posted (10 years 7 months 1 week 2 days 7 hours ago) and read 5071 times:

Didn't Boeing have a part in United before the deregulation?


A318, A320, A332, A333, B1900, B722, B732, B733, B734, B735, B737, B738, B772, CR1, CR2, CR7, CR9, MD80, MD81, MD82, MD8
User currently offlineLMP737 From , joined Dec 1969, posts, RR:
Reply 2, posted (10 years 7 months 1 week 2 days 5 hours ago) and read 4878 times:

United was a part of Boeing back in the 20's-early 30's until the government banned aircraft manufacturers from owning airlines.

User currently offlineAwschucksflyer From Canada, joined Nov 2003, 150 posts, RR: 0
Reply 3, posted (10 years 7 months 1 week 2 days 5 hours ago) and read 4840 times:

I had no idea that Hawaiian was in protection.

I guess this was my tid bit of learning something new today!

AWSCHUCKS!


User currently offlineKKMolokai From United States of America, joined Feb 2000, 760 posts, RR: 2
Reply 4, posted (10 years 7 months 1 week 2 days 5 hours ago) and read 4787 times:

Trustee Statement On Boeing Plan Filing

HONOLULU, February 11, 2004 -- Hawaiian Airlines Trustee Joshua Gotbaum issued the following statement relating to this morning’s filing of a Plan of Reorganization by The Boeing Company and the Corporate Recovery Group:

Any proposal to invest in Hawaiian Airlines is a statement of confidence in the airline, its people, and its prospects.

Having just received the proposal, our first task is to review and understand what it offers, and then to discuss it with our creditors. Some items that are important to Hawaiian's future are not spelled out in the document. Others are conditioned on CRG's learning more about Hawaiian, and we will arrange to provide additional information.

We expect the plan filed will serve as a starting point for others that have expressed similar interest in Hawaiian. The task now is to enable other investors to come forward on an informed basis. If a significant interest in Hawaiian is to be sold, competition for the opportunity to purchase such an interest will generate the greatest value to its creditors and other constituencies, while enabling a rapid exit from bankruptcy.



We are the people of American Airlines. And we know why you fly.
User currently offlineL.1011 From United States of America, joined Aug 2001, 2209 posts, RR: 9
Reply 5, posted (10 years 7 months 1 week 2 days 5 hours ago) and read 4761 times:

Is it legal for airlines to own aircraft manufacturers?

User currently offlineBehramjee From Canada, joined Aug 2003, 4784 posts, RR: 43
Reply 6, posted (10 years 7 months 1 week 2 days 5 hours ago) and read 4753 times:

If BOEING does indeed take over HA, then it should give it more B 763s to fly more international routes than only SYDNEY and YVR.

It should be made able to fly to YYZ-EWR-JFK-ORD-NRT-ICN-HKG-TPE nonstop from HNL.

Especially those Far East destinations have the potential of bringing in high yield pax.


User currently offlineGreg From United Kingdom, joined May 2005, 0 posts, RR: 0
Reply 7, posted (10 years 7 months 1 week 2 days 4 hours ago) and read 4617 times:

There are no high yield passengers to/from Hawaii--most definitely NOT from Asia/Pac. It's 99% tourists.

User currently offlineSpark From United States of America, joined Mar 2002, 431 posts, RR: 0
Reply 8, posted (10 years 7 months 1 week 2 days 2 hours ago) and read 4432 times:

Hawaii to Japan may not be high yield, but Hawaiian pretty much relies on Tourist $. I think a Hawaiian should operate to Japan, as Japanese Airlines seem to have no problem flying to Hawaii.

User currently offlineBehramjee From Canada, joined Aug 2003, 4784 posts, RR: 43
Reply 9, posted (10 years 7 months 1 week 2 days 1 hour ago) and read 4304 times:

JAL and ANA have around 6-8 daily flights to HNL from Japan (KIX-NRT etc) with B 747s and B 777s and in addition UAL flies a double daily B 777 in 3 classes HNL-NRT-HNL and NWA too flies A 333s-DC 10s and sometimes B 742s on the HNL-NRT-HNL route...so there is demand for a good business class product.

JAPAN make up the largest tourists entering HAWAII out of international countries so the market to exploit for HA is definitely there plus being HNLs official airline, they can market Hawaii and HNL better with packages and hotel deals etc etc.

Plus they can take pax to USA and YVR via HNL!!!


User currently offlineAloha73g From United States of America, joined Jul 2003, 2362 posts, RR: 4
Reply 10, posted (10 years 7 months 1 week 2 days 1 hour ago) and read 4263 times:

Hawaiian does not fly to YVR. Aloha does.

Aloha!



Aloha Airlines - The Spirit Moves Us. Gone but NEVER Forgotten. Aloha, A Hui Hou!
User currently offlineKevin752 From United States of America, joined Jul 2003, 726 posts, RR: 4
Reply 11, posted (10 years 7 months 1 week 2 days ago) and read 4187 times:

I was just reading that HA and Boeing were in a WAR. HA wanted to Reject all their boeing planes that they just bought or were in the process in buying. I do not think that boeing should take over HA. But that is what I think.


"Keep Climbing"
User currently offlineAmwest25 From , joined Dec 1969, posts, RR:
Reply 12, posted (10 years 7 months 1 week 1 day 23 hours ago) and read 4103 times:

"Is it legal for airlines to own aircraft manufacturers?"

More likem aircraft manufactuers owning airlines. Boeing wants to take over HA not the other way around,.


User currently offlineKalakaua From United States of America, joined Jan 2004, 1516 posts, RR: 5
Reply 13, posted (10 years 7 months 1 week 1 day 23 hours ago) and read 4072 times:

"More likem aircraft manufactuers owning airlines. Boeing wants to take over HA not the other way around,. "

I think he was serious when he asked that question...


"Is it legal for airlines to own aircraft manufacturers?"

Umm.. I doubt that's possible, right now...



Gravity explains the motions of the planets, but it cannot explain who set the planets in motion.
User currently offlineKalakaua From United States of America, joined Jan 2004, 1516 posts, RR: 5
Reply 14, posted (10 years 7 months 1 week 1 day 23 hours ago) and read 4035 times:

Here's a press release from Boeing's website...
http://www.boeing.com/news/releases/2004/q1/nr_040211a.html

And a release from Hawaiian Air's website...
http://www.hawaiianair.com/about/corporate/NewsRelease/Section_346.asp



Gravity explains the motions of the planets, but it cannot explain who set the planets in motion.
User currently offlineTekelberry From United States of America, joined May 2003, 1459 posts, RR: 4
Reply 15, posted (10 years 7 months 1 week 1 day 22 hours ago) and read 3969 times:

I was just reading that HA and Boeing were in a WAR. HA wanted to Reject all their boeing planes that they just bought or were in the process in buying. I do not think that boeing should take over HA. But that is what I think.

Not quite. HA can't pay their bills on their lease with Boeing, and that's why Boeing is pissed.

Boeing Capital Corporation isn't the same division as the aviation portion of Boeing. Boeing Capital just deals with finances.


User currently offlineL-188 From United States of America, joined Jul 1999, 29799 posts, RR: 58
Reply 16, posted (10 years 7 months 1 week 1 day 22 hours ago) and read 3930 times:

If this happens 10 will get you 20 that we won't see any Airbuses in HA's fleet.



OBAMA-WORST PRESIDENT EVER....Even SKOORB would be better.
User currently offlineHNLFlyboy From United States of America, joined Jan 2004, 321 posts, RR: 1
Reply 17, posted (10 years 7 months 1 week 1 day 22 hours ago) and read 3916 times:

L-188, were Airbuses ever an option for the HA fleet?

User currently offlineHAL From United States of America, joined Jan 2002, 2561 posts, RR: 53
Reply 18, posted (10 years 7 months 1 week 1 day 20 hours ago) and read 3846 times:

Not quite. HA can't pay their bills on their lease with Boeing, and that's why Boeing is pissed.

Not exactly correct. Our former CEO John Adams, wanted to pay less for our leases with Boeing and the other aircraft lessors. He made a deal with Ansett and ILFC, but Boeing balked because they felt Adams had siphoned too much money from HA into his own holding company. Adams decided to declare bankruptcy to force Boeing into renegotiating the leases, but it backfired when Boeing petitoned the bankruptcy court into replacing Adams with a Trustee. Boeing won that one, and now we have Joshua Gotbaum running the show.

Hawaiian has made money every month since declaring bankruptcy, and is even now paying Boeing every month for the leases on the planes, at a rate that is probably more than we'll end up paying for them in the end. The ONLY thing Hawaiian isn't paying right now is the required money into the pilots pension plan. But that is another subject and from my point of view (as a furloughed HA pilot) a very sore one.

HAL



One smooth landing is skill. Two in a row is luck. Three in a row and someone is lying.
User currently offlineBluewave 707 From United States of America, joined Jun 2001, 3152 posts, RR: 6
Reply 19, posted (10 years 7 months 1 week 1 day 19 hours ago) and read 3789 times:

If HA's bankruptcy team doesn't get their act together, they will sink the airline.

They are making it sound like they've got the power, when they themselves are the ones behind the 8-ball. Excuse me, did I miss something in basic business? The lessee doesn't have more power over the lessor, other than the fact that there is money being paid back.
The fact that ex-CEO Adams screwed HA is one for the ages.

As the turbine spins ...



"The best use of your life will be to so live your life, that the use of your life will outlive your life" -- D Severn
User currently offlineRayChuang From United States of America, joined Jun 2000, 8016 posts, RR: 5
Reply 20, posted (10 years 7 months 1 week 1 day 14 hours ago) and read 3661 times:

Actually, the reason why a lot of Japanese go to Hawaii is the fact there is a huge ex-patriate Japanese community there, dating from the beginning of the 20th Century when Japanese workers were hired to work on sugar cane and pineapple farms.

That's the reason why JL and NH fly multiple flights per day to Hawaii from NRT, KIX, etc.


User currently offlineKKMolokai From United States of America, joined Feb 2000, 760 posts, RR: 2
Reply 21, posted (10 years 7 months 1 week 1 day 14 hours ago) and read 3629 times:

Posted on: Thursday, February 12, 2004
Wyoming firm puts in bid for Hawaiian Airlines

• Reorganization plan for airline would void stock

By Debbie Sokei and Deborah Adamson
Advertiser Staff Writers

Boeing Capital Corp. and former Hawaiian Airlines CEO Bruce Nobles have joined with a little-known turnaround company based in Wyoming in a bid to take over the bankrupt Hawaiian Airlines.

Corporate Recovery Group LLC of Wilson, Wyo., proposed bringing Hawaiian out of bankruptcy by investing $30 million cash and cutting the cost of jets the carrier leases from Boeing. In exchange, CRG would eventually own 90 percent of the airline, and Boeing Capital would get back some of the more than $40 million Hawaiian owes it. Hawaiian Airlines' current shareholders would get nothing.

The proposal is the first of what is expected to be several competing offers to bring Hawaiian out of bankruptcy. The courts and airline creditors will determine which bid wins.

Under the plan announced yesterday, Hawaiian would continue flying all its routes and employees would not be asked for concessions, except for renegotiating the pilots' pension plan.

"This validates that Hawaiian is a great airline that can be reorganized efficiently and set free to compete in our improving market," said Jim Giddings, chairman of Hawaiian Airlines' unit of the Air Line Pilots Association. "In the end, the author of the winning plan isn't as important to us as whether the plan itself protects the pay and benefits that we have earned."

The fact that Boeing Capital was the first out of the gate with a plan could be an attempt by Boeing, Hawaiian's largest creditor, to set a floor on what creditors get in the reorganization, said Jerrold Guben, an attorney with Reinwald, O'Connor & Playdon who specializes in bankruptcy cases.

Often creditor groups want to encourage competition for a bankrupt company, aware that the increased bidding could raise the amount they get back on their debts.

CRG said it would repay all unsecured claims of $500,000 or more, which includes Boeing's claim, with subordinated notes — which are similar to corporate bonds — as warrants redeemable for shares in the reorganized airline and proceeds from lawsuits.

Smaller unsecured creditors would get 50 percent of their claims.

"The ability to exchange notes for the larger unsecured claims really sets this plan apart," Nobles said. "Often, creditors receive only stock in their reorganized company. These notes would be repaid at market rates, providing creditors with an attractive recovery that is higher than is customary in airline bankruptcies."

Josh Gotbaum, the court appointed trustee of the airline, said the CRG plan is "a starting point for others that have expressed similar interest in Hawaiian."

Gotbaum has said he will be filing a reorganization plan of his own in June. Last month he told employees last month he needed $11 million in labor concessions to bring the airline out of bankruptcy, which was met with opposition from the airline's unions.

In addition to CRG and Gotbaum, reorganization plans will likely come from John Adams, the chairman of Hawaiian Airlines' parent Hawaiian Holdings Inc., and Vx Capital Partners, a San Francisco-based private finance firm that invest in commercial aircraft.

Thomas Fritsch, in-house counsel and spokesman for Hawaiian Holdings, objected to CRG's plan because it leaves the approximately 4,000 Hawaiian shareholders with nothing.

"We will continue to champion shareholder interests and will fight to maintain value for shareholders," Fritsch said in a statement.

Stephen Compagni Portis, a partner in Vx Capital, said his plan is in the advance stages. Compagni Portis was in Hawai'i yesterday meeting with stakeholders and employees. He said he has the capital to bring Hawaiian out of bankruptcy but would not disclose how much he is willing to invest in the airline.

CRG argued that by partnering with Boeing and Nobles, the former CEO of Hawaiian, its plan has advantages the others cannot deliver, including getting a better deal on future jet leases.

"This plan contains mutually agreeable revisions to the Boeing aircraft leases, which will result in substantial cost savings to the airline and the continued availability of a new Boeing fleet," Nobles said.

Nobles, Hawaiian's CEO from June 1993 to March 1997, helped guide Hawaiian out of its last bankruptcy reorganization in 1994.

"Nobles' previous HAL experience may give his plan some credibility," said Giddings, the pilot union representative.

While Adams will try to protect shareholders in his plan, the CRG plan is aimed at protecting the creditors.

Boeing Capital, which is the largest unsecured creditor, says it is owed $40 million and that claim could go up substantially. Hawaiian has 11 Boeing 717 and three Boeing 767-300 jets under long-term lease from Boeing Capital. The money owed is for non-delivery of three additional Boeing jets.

Among Hawaiian's other creditors is Panda Travel, a Honolulu-based travel agency, which is owed $5.6 million. Jim Donovan, spokesman for the travel agency, said the company is aware of CRG's plan and will review it next week.

Star Seigle Communications, Hawai'i's largest marketing company, is waiting to collect $570,000 from Hawaiian.

Hawaiian did clear a $550,000 debt with Hawaii Medical Services Association shortly after the company filed for bankruptcy in March.

An attorney for the unsecured creditors committee said yesterday they are reviewing the CRG plan.

CRG has arranged a Feb. 27 bankruptcy court hearing where the investors will ask the court to set a deadline for other Hawaiian bids and grant CRG a topping fee of $5.8 million, an amount they want to be paid if their bid fails.

Gotbaum objected to the topping fee, in a bankruptcy court filing late yesterday.



We are the people of American Airlines. And we know why you fly.
User currently offlineKKMolokai From United States of America, joined Feb 2000, 760 posts, RR: 2
Reply 22, posted (10 years 7 months 1 week 1 day 14 hours ago) and read 3618 times:

Posted on: Thursday, February 12, 2004
Reorganization plan for airline would void stock

• Turnaround firm has links to airline
• Wyoming firm puts in bid for Hawaiian Airlines

By Deborah Adamson
Advertiser Staff Writer


A reorganization plan for Hawaiian Airlines has been put forth by Boeing Capital and Corporate Recovery Group .
Bruce Asato • The Honolulu Advertiser

Shareholders of Hawaiian Holdings, the parent of Hawaiian Airlines, would be left with little of value under the reorganization plan proposed by Boeing Capital and a Wyoming investment group.
While Hawaiian Holdings shares would continue to trade, its principal asset is Hawaiian Airlines stock, which would be canceled under the proposal announced yesterday. "Those assets will cease to have value," said Ron Orr, principal of Wilson, Wyo.-based Corporate Recovery Group LLC.

The plan announced yesterday is just one of several expected to be put forward in bankruptcy court. The court and creditors will eventually decide which proposal to accept.

When a company emerges from Chapter 11 bankruptcy, existing shares typically get canceled on the effective day of the reorganization as new shares are issued. It's more complicated in Hawaiian Airlines' case because of the holding company structure created two years ago.

When Hawaiian Holdings was established, shareholders of Hawaiian Airlines exchanged their stock for those of the parent. Hawaiian Airlines shares were taken private while Hawaiian Holdings became the publicly traded entity.

Hawaiian Holdings is controlled by former Hawaiian Airlines CEO John Adams.

The parent company, which was incorporated in Delaware, has 28 million shares outstanding.

Hawaiian Holdings will likely come up with its own reorganization plan, said Jerrold Guben, a bankruptcy attorney with Reinwald O'Connor & Playdon in Honolulu.

Shares of Hawaiian Holdings fell by 7.5 percent to $4.53 yesterday. Last year, the stock rose by 46 percent. This year thus far, Hawaiian Holdings is up 51 percent.

Reach Deborah Adamson at dadamson@honoluluadvertiser.com or 525-8088.

• • •

Turnaround firm has links to airline

Corporate Recovery Group LLC, the firm joining with Boeing Capital Corp. in a bid to take over and restructure Hawaiian Airlines, is a small, private turnaround firm run by a bankruptcy attorney, the former CEO of a major accounting firm and a co-founder of CBS MarketWatch.

Ron Orr, a principal, owner and lead figure in CRG, is a Los Angeles attorney who was a partner at Gibson, Dunn & Crutcher and head of the firm's insolvency practice. Orr was counsel to Hawaiian Airlines in its previous Chapter 11 restructuring from 1993 to 1994, when Bruce Nobles headed the airline.

"Bruce and I have maintained a friendship and have been in contact ever since," Orr said.

CRG has tapped Nobles to head the airline again if it succeeds in taking over Hawaiian.

Orr formed a legal and business consulting practice in 1997 and has acted as a business consultant to real-estate private equity firm Colony Capital Inc.

CRG is based in Wilson, Wyo., near where principal and owner Allan Tessler lives. Tessler, a lawyer and specialist in turnaround financing, is a co-founder of CBS MarketWatch and headed Financial News Network. Orr met Tessler while representing FNN in 1991.

Tessler is chairman of J Net Enterprises, an Internet incubator that he created after running a slot machine company called Jackpot Enterprises.

A third owner and principal, Eugene Freedman, is former chief executive and chairman of Coopers & Lybrand LLP, U.S. He is a former managing director of private equity firm Monitor Clipper Partners and has been senior adviser of Monitor Company Group LP, a business strategy and consulting firm.

According to CRG's brochure, the three principals "have successfully restructured major businesses in bankruptcy proceedings from start to finish. While we work with and for institutional investors and capital sources, we also have established relationships with capital sources that know and respect us, have substantial available capital and are interested, when required and appropriate, in investing in challenging situations."

— Kelly Yamanouchi, Advertiser staff writer



We are the people of American Airlines. And we know why you fly.
User currently onlineCoronado990 From United States of America, joined Oct 2003, 1598 posts, RR: 2
Reply 23, posted (10 years 7 months 1 week 1 day 13 hours ago) and read 3523 times:

I can see it now....A HA 767-300 at JAC. Via SFO or LAX I would hope!




Uncle SAN at your service!
User currently offlineOkie From United States of America, joined Jul 2003, 3037 posts, RR: 3
Reply 24, posted (10 years 7 months 1 week 1 day 7 hours ago) and read 3355 times:

Q. Is it legal for a airplane manufacturer to own and airline

A. Boeing Capital owns 8.6% of AirTran

ever wonder where all those 717's came from?


Okie



25 AirframeAS : Is it legal for airlines to own aircraft manufacturers? Dont you mean the other way around?? Is it illegal for AIRCRAFT manufacturers to own airlines?
26 Gigneil : Boeing can own whomever they choose, and if they wanted to make airplanes and fly them on their own there's no problem with that at all. N
27 Hawaiian717 : HNLFlyboy wrote: were Airbuses ever an option for the HA fleet? From what I understand, yes. A320 family was considered as a possibility to replace th
28 HAL : From what I understand, yes. A320 family was considered as a possibility to replace the DC-9s, and A330 was considered for DC-10 replacement. But not
29 KKMolokai : Posted on: Friday, February 13, 2004 Hawaiian shares down 15% By Deborah Adamson Advertiser Staff Writer RONALD S. ORR Shares of Hawaiian Airlines' pa
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