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UA To Get $3 Billion In Exit Financing!  
User currently offlineHoya From United States of America, joined Jun 2004, 382 posts, RR: 0
Posted (8 years 7 months 4 weeks 1 day 6 hours ago) and read 8867 times:

Four major lenders - JPMorgan Chase & Co., Citigroup Inc., Deutsche Bank A.G. and General Electric Capital Corp. - will provide UA with $3 billion in exit loans. This is more than what UA was hoping for, which was roughly $2.5 billion. Looks like these lenders think UA's business plan may actually work.

Also, UA posted a $113 million operating profit in July, and finished July with $2.8 billion in cash. Looks like UA is on the slow path to recovery. More here:

http://chicagobusiness.com/cgi-bin/news.pl?id=17564


Hoya Saxa!!
75 replies: All unread, showing first 25:
 
User currently offlineFlypdx From United States of America, joined Apr 2005, 636 posts, RR: 0
Reply 1, posted (8 years 7 months 4 weeks 1 day 6 hours ago) and read 8855 times:

Good news for UA! I hope my favorite airline can make it through!

User currently offlineAirRyan From United States of America, joined Mar 2005, 2532 posts, RR: 5
Reply 2, posted (8 years 7 months 4 weeks 1 day 6 hours ago) and read 8850 times:

Wow, that's outstanding - that's more of an operating profit in one month than they have turned in an entire quarter for a long time! Hopefully it will be nothing but good times for them in the future!

User currently offlineAirbuff From Canada, joined Aug 2005, 140 posts, RR: 0
Reply 3, posted (8 years 7 months 4 weeks 1 day 6 hours ago) and read 8769 times:

I certainly do wish them nothing but good things.


Where am I going, and why am I in this handbasket?
User currently offlineAerohottie From Australia, joined Mar 2004, 792 posts, RR: 3
Reply 4, posted (8 years 7 months 4 weeks 1 day 5 hours ago) and read 8718 times:

Excellent results considering the price of fuel at the moment.
Hopefullt this is the end of UA troubles.



What?
User currently offlineExFATboy From United States of America, joined Jul 2003, 2974 posts, RR: 9
Reply 5, posted (8 years 7 months 4 weeks 1 day 5 hours ago) and read 8692 times:

At the risk of sounding pessimistic, the debt burden that UA will operate under with this financing concerns me...a case can be made for trying to seek equity financing instead.

However, just the fact that they have the financing in place - and not only turned an operating profit in July but would have turned a profit overall if not for reorganization costs, is good news for UA.


User currently offlineWhiteHatter From , joined Dec 1969, posts, RR:
Reply 6, posted (8 years 7 months 4 weeks 1 day 5 hours ago) and read 8690 times:

Quoting Hoya (Thread starter):
. Looks like these lenders think UA's business plan may actually work.

It's probably more a case of them protecting their existing position with UA. If the lenders can see a clear strategy then they can be persuaded to go 'double or quits', or something along those lines anyway!

They will want to try and get their original pre-bankruptcy money back (or some of it at least depending on how much they have discounted those debts) so would look favourably on United and advance them some more. That way UA can trade itself out of trouble.

They certainly won't be doing it of they have any major doubts, so it does look good for UA's future. And good luck to them all, especially the workers who have had to suck it up and give back plenty to see UA come through this in one piece.


User currently offlineAMSSpotter From Netherlands, joined Feb 2005, 271 posts, RR: 1
Reply 7, posted (8 years 7 months 4 weeks 1 day 5 hours ago) and read 8664 times:

Great news for United, the airline many people thought was doomed.
I wish United all the luck, I've always had good experiences with them!


User currently offlineUnitedgirlie From United Kingdom, joined Aug 2005, 98 posts, RR: 0
Reply 8, posted (8 years 7 months 4 weeks 1 day 5 hours ago) and read 8617 times:

lets hope they can afford us new uniforms now

not that I am shallow or anything

much!


User currently offlineCslusarc From Canada, joined May 2005, 829 posts, RR: 0
Reply 9, posted (8 years 7 months 4 weeks 1 day 4 hours ago) and read 8471 times:

It doesn't sound good that UA will emerge with $3 Billion of DEBT financing and $0 of EQUITY financing.

I think UA NEEDS to raise an equal $3 Billion in EQUITY financing. I don't know any inverstor who would rationally invest in a loss making enterprise with little hope of recovery.



--cslusarc from YWG
User currently offlineOzarkD9S From United States of America, joined Oct 2001, 4879 posts, RR: 22
Reply 10, posted (8 years 7 months 4 weeks 1 day 4 hours ago) and read 8467 times:

$1 billion for each year in BK. Not bad.

If they had stayed in for a fourth year would they have gotten $4 billion?

Best of luck to UA and the employees.



Next Up: STL-TPA-BWI-PWM-BWI-STL
User currently offlineLegacytravel From United States of America, joined Aug 2005, 1067 posts, RR: 2
Reply 11, posted (8 years 7 months 4 weeks 1 day 4 hours ago) and read 8355 times:

To the best damn airline out there congratulations. And to every one of the most professional and courteous employees of UAL who have had to suffer through this. Congratulations. I look forward to booking all my clients on UAL for years to come and I will see you in Oct for a family trip.
Mark in MKE



I love the smell of Jet fuel in the Morning
User currently offlineYyz717 From Canada, joined Sep 2001, 16228 posts, RR: 57
Reply 12, posted (8 years 7 months 4 weeks 1 day 3 hours ago) and read 8281 times:

Quoting Cslusarc (Reply 9):
It doesn't sound good that UA will emerge with $3 Billion of DEBT financing and $0 of EQUITY financing.

I agree completely. I have not been following the UA Chap 11 shenanigans too closely (Canada has its own bankrupt STAR alliance carrier for entertainment) but I presume this debt equity is from major creditors who really have no choice but to play ball.

With the same incompetent mgmt and militant work force in place, the future does not look bright for UA, even without this proposed debt load.

United.....sinking?



Panam, TWA, Ansett, Eastern.......AC next? Might be good for Canada.
User currently offlineGalapagapop From United States of America, joined Feb 2005, 910 posts, RR: 4
Reply 13, posted (8 years 7 months 4 weeks 1 day 3 hours ago) and read 8178 times:

I think everyone and their Grandma made a operational profit this past July(except DH, as this is A net), so that shouldn't be the focal reason as to why they'd get these loans (at least I hope not). But the challenge will be them making a net profit and keeping an operational profit during the winter months. Not to mention them getting that cost structure reorganized and hopefully spend 1.5B for fuel hedgingBut its finally good to see them on their way and without government handouts.

User currently offlineAerobalance From United States of America, joined Sep 2000, 4674 posts, RR: 48
Reply 14, posted (8 years 7 months 4 weeks 1 day 2 hours ago) and read 8078 times:

Go UA!

It must be the new paintjob.....



"Sing a song, play guitar, make it snappy..."
User currently offlineFriendlySkies From United States of America, joined Aug 2004, 4091 posts, RR: 5
Reply 15, posted (8 years 7 months 4 weeks 1 day 2 hours ago) and read 8052 times:

Surprised nobody has said it...Airbus isn't listed as one of the lendors...bye bye A380/A350 rumors!

EDIT: Yes I know this isn't final but I still believe those rumors are pretty much dead.

Also note UA would have made a $76 mil NET profit last month if it weren't for reorganization expenses.

[Edited 2005-08-26 04:57:58]

User currently offlineGalapagapop From United States of America, joined Feb 2005, 910 posts, RR: 4
Reply 16, posted (8 years 7 months 4 weeks 1 day 2 hours ago) and read 7985 times:

Quoting FriendlySkies (Reply 15):
Also note UA would have made a $76 mil NET profit last month if it weren't for reorganization expenses.

DH almost made a profit last month if you exclude fuel costs......
Almost is not in the black.


User currently offlineUAL777 From United States of America, joined Aug 2003, 1519 posts, RR: 5
Reply 17, posted (8 years 7 months 4 weeks 23 hours ago) and read 7847 times:

Quoting Yyz717 (Reply 12):
With the same incompetent mgmt and militant work force in place, the future does not look bright for UA, even without this proposed debt load.

Yyz717 this is an extremely ignorant statement that is totally wrong. If management is SO incompetent, then why are they exiting bankruptcy intact? UA did not sell their Heathrow slots, Pacific rights, or close any hubs. They went in as the number 2 US carrier and are emerging as the number 2 carrier.

In addition how are the work groups "militant"? Oh I forgot how all three work groups went on strike last year forcing UA into Chap. 7.....  Wow!

Please post something relevent and at least remotly based on fact before you post something so ignorant and insulting to the thousands of UA employees who have made enormous strides and sacrifices for United.

Quoting Galapagapop (Reply 13):
I think everyone and their Grandma made a operational profit this past July

Um, wrong. DL is burning through 2 million dollars a day. DH didn't. US and NW still have to report, so I don't think this qualifies as "everyone and their grandma".

Furthermore. There is a HUGE difference between UA and DH. UA made an operational profit INCLUDING fuel DH did not; and while I normally live by the "almost only counts in hand grenades and nuclear weapons" philosophy, only a blind man would not see the difference between the two carriers.

In closing, I would dare say UA is almost or is as strong as CO and AA and due to the termination of the pension plan, will have a lower debt load than AA and possibly CO when they emerge this winter.

Good work UA leaders, employees, and family. We're ready to rock and roll again!



It is always darkest before the sun comes up.
User currently offlinePyroGX41487 From United States of America, joined Oct 2004, 280 posts, RR: 0
Reply 18, posted (8 years 7 months 4 weeks 23 hours ago) and read 7776 times:

This great, great news! I hope that this stops the UA-bashers for the time being... Big grin

User currently offlineUadc8contrail From United States of America, joined Sep 2003, 1782 posts, RR: 10
Reply 19, posted (8 years 7 months 4 weeks 22 hours ago) and read 7748 times:

I agree completely. I have not been following the UA Chap 11 shenanigans too closely (Canada has its own bankrupt STAR alliance carrier for entertainment) but I presume this debt equity is from major creditors who really have no choice but to play ball.

With the same incompetent mgmt and militant work force in place, the future does not look bright for UA, even without this proposed debt load.

United.....sinking?


YYZ717--will you post the same dribble that has been spewing out of you when your beloved red tail files ch11 or when the great southern airline files???and stays in bk court as long as ual?????of course not...



bus driver.......move that bus:)
User currently offlineGigneil From United States of America, joined Nov 2002, 16345 posts, RR: 86
Reply 20, posted (8 years 7 months 4 weeks 22 hours ago) and read 7717 times:

Quoting Uadc8contrail (Reply 19):
Canada has its own bankrupt STAR alliance carrier for entertainment)

No it doesn't.

N


User currently offlineUadc8contrail From United States of America, joined Sep 2003, 1782 posts, RR: 10
Reply 21, posted (8 years 7 months 4 weeks 22 hours ago) and read 7704 times:

neil,
the above quote is from from our neighbor to the north that doesnt have a clue that the maple leaf tail has actually exited bk a while ago......



bus driver.......move that bus:)
User currently offlineUadc8contrail From United States of America, joined Sep 2003, 1782 posts, RR: 10
Reply 22, posted (8 years 7 months 4 weeks 20 hours ago) and read 7608 times:

It doesn't sound good that UA will emerge with $3 Billion of DEBT financing and $0 of EQUITY financing.

I think UA NEEDS to raise an equal $3 Billion in EQUITY financing. I don't know any inverstor who would rationally invest in a loss making enterprise with little hope of recovery.



--cslusarc from YWG



CSLUSARC,
im not a betting man BUT.....I would rather have ual in 3 bln $$$$ worth of debt than deltas 20+bln dollars worth of debt................



bus driver.......move that bus:)
User currently offlineYyz717 From Canada, joined Sep 2001, 16228 posts, RR: 57
Reply 23, posted (8 years 7 months 4 weeks 16 hours ago) and read 7460 times:

Quoting UAL777 (Reply 17):
Quoting Yyz717 (Reply 12):
With the same incompetent mgmt and militant work force in place, the future does not look bright for UA, even without this proposed debt load.

Yyz717 this is an extremely ignorant statement that is totally wrong. If management is SO incompetent, then why are they exiting bankruptcy intact? UA did not sell their Heathrow slots, Pacific rights, or close any hubs. They went in as the number 2 US carrier and are emerging as the number 2 carrier.

In addition how are the work groups "militant"? Oh I forgot how all three work groups went on strike last year forcing UA into Chap. 7.....

If mgmt were competent, UA would be profitable. But UA is bankrupt.

If UA unions were not militant, then UA unit costs would be higher. But they aren't.

The future remains bleak with the same failed people running the airline (mgmt and staff).

Quoting Uadc8contrail (Reply 21):
neil,
the above quote is from from our neighbor to the north that doesnt have a clue that the maple leaf tail has actually exited bk a while ago......

I used the wrong tense and typed "has" instead of "had". My bad. Let's not divert attention from the current incompetence at UA. This is a thread about UA problems, not AC semantics.



Panam, TWA, Ansett, Eastern.......AC next? Might be good for Canada.
User currently offline777boi From Australia, joined Jan 2005, 133 posts, RR: 0
Reply 24, posted (8 years 7 months 4 weeks 16 hours ago) and read 7432 times:

All the best to UA... have always had good experiences with them.. hope there is many more to come!

25 FriendlySkies : You really sicken me. All you do in UA threads is talk about how failed and useless the employees are. Are you trying to tell me it's the EMPLOYEES f
26 Tockeyhockey : what are the chances that some of that exit funding goes toward an order of some brand new 787s?!
27 UAL777 : What part of operational profit do you not understand? Excluding bankruptcy charges they WERE profitable. Read! As to your second sentance, you state
28 RAMPRAT980 : So the first three billion dollars in profit, they make, goes to the creditors to pay off the loan. That sounds like a whole lot of money to me. Good
29 GARPD : This is great news. I just hope UA managment can get it right. Perhaps they should hire Bethune!
30 UA744Flagship : UAL777, thanks for keeping the idiots in check. I was outraged at these inane comments as well... Welcome to my RU list!
31 Galapagapop : No UA is not even close to AA's and CO's level they just turned an operational profit (good work still) but its been 3+ years and they still are clim
32 TPASXM787 : Whew...coming out of bk with another $3bln in debt...best of luck to UA...I hope they make it...
33 UAL777 : This is where I disagree: When I say almost or as strong, I am talking operationally. Yes pensions were dumped, that I not being debated at all. Howe
34 LJ : It's more like 3 billion + a very high interst rate charge every year + a very big fee for the arrangers upfront so that they recoup their losses eve
35 United Airline : Hope UA will return to pre 2000 level in terms of size and profit one day....
36 Post contains links 1MillionFlyer : cluelessness rules on A.Net! this is the same guy that asked this gem of an idiotic question: Should AC Buy DL's 21 Boeing 767-432ERs? (by Cslusarc A
37 Galapagapop : They assumed 3 billion in debt, so obviously its not the same UA UA in many ways has more debt than any other carrier in the US. Their obligations al
38 DFORCE1 : What is the interest UA will have to pay on their new exit financing vs. their operating profit? Furthermore, I think it's awfully bold to say that UA
39 Kurt : Why such UA-hate? Beats me. But this UA 1K is flying DEN-LAS tonight on Ted and it is just the kind of flight I like - a nice aisle seat in Economy P
40 FriendlySkies : What more should UA do? The fares are competitive, the load factors are somewhere around 89% (on Ted, systemwide I think is like 81%), there's IFE (n
41 Post contains images DFORCE1 : If it's the same girls as on Hooters air, then yes!
42 777adoration : Thank you! I work in that feild and this is completley true!
43 Mainliner : Great news for United! I hope there's more good news to come in the next few years...all these bad vibes from UA bashers kind of wear me down sometime
44 Ua2162 : Ha! Going under? I doubt it! Where are all those people now? Great news, it looks like UA has nothing but good things to look forward to.
45 Galapagapop : UA-Hate? I do not in anyway have anything against UA, flew them 3 weeks ago on P.S. and the flight was A+++ all the way. And I had the nicest FA help
46 777adoration : It is not "UA hate" or bashing as some call it. It is more a case of, if someone is "fronting" you that amount of money, they want something in return
47 Post contains images UAcosCS : You will be getting your CO uniform via UPS ground. You'll see it in 3 or 4 Weeks, they are coming from Guam. Why are you ignoring me?
48 MSY-MSP : One thing that seems to be missing from much of the understanding here is how charges in bankruptcy are calculated. Yes, they showed an operating prof
49 Yyz717 : Then you must get sick alot if benign analysis and non-emotional commentary get under your skin. Yes, it is also the employees' fault when a company
50 Mattnrsa : UA posted an operational profit for the 2nd quarter when not everyone did. Their cash balance has increased over the first half of the year to almost
51 UALdispatch : UNITED WILL STAND!! We still have a long way to go but this is a step in the right direction. Amazing on how just a few days ago people had UA buried
52 1MillionFlyer : Again, why should we beleive you? give me a break. If this is supposed to be a website for aviation enthusiasts. It has turned into a site for whinin
53 CTHEWORLD : How so? They have renegotiated every single CBA, nearly eliminated their pension problem, renegotiated every a/c lease, renegotiated nearly ever muni
54 UALdispatch : Well sad! I couldnt have said it better myself. For the record I have been very skeptical of this managment team from the start but #'s and actions d
55 Slider : They're tying on the proverbial albatross before even exiting bankruptcy, which will be delayed again. That Jake Brace could have a gig at the circus
56 UAL777 : However, what you fail to comprehend is that these bankruptcy charges would not have been incured if UA was not in Chap. 11. Now I realize that they
57 CTHEWORLD : True Yyz717 appears ignorant, probably is. Before people jump all over you, can I clarify one of your statments? UAL is the most productive amongst t
58 CHI787ORD : God I hope so. Also, I want to see UAL back in India. They are now the only US carrier out of the big five that doesnt have any operations in India.
59 Yyz717 : Just look at the horrendous financial performance over the past 5 years. It speaks loudly of incompetent mgmt. Ummm.....what do you want in a website
60 777ER : I was expecting to read that Airbus is part of the financing team cause of all the rumors that keeped popping up all the time.
61 Post contains images Galapagapop : Like an additional $3+ Billion in Debt and loans? Yes thats something every airline wants and looks forward to ....
62 RCS763AV : Good for UA. But everyone is going very excited and i dont think its time to say they are safe. Remember the cases of US and NW.
63 Post contains images 1MillionFlyer : Get a clue, you have no idea of what it takes to run an airline so just be happy you have a website to act like an arm-chair quarterback and feel goo
64 Post contains links ASMD80 : I have to agree with that. And, I used to be a UA basher myself. Even if you dislike UA, competition is good! Without UA, you might end up paying $10
65 Avek00 : The financing is all debt. I don't deny that United has done a decent job financially while enjoying creditor protection. However, there are VERY FEW
66 UAcosCS : The airline everyone loves to hate. Kind of like hating Bush, something has to fuel your fire. Well put, It gets old. We aren't out of the woods yet.
67 CTHEWORLD : How could you possibly qualify such a sweeping, moronic statement? I'm done with this thread, no point in arguing with an idiot.
68 Wdleiser : Name 3 Major Legacies that have made a profit for the entire year the past 3 years. They made a profit before the bankruptcy charges were calculated.
69 Cslusarc : This seems so true. Unfortunately, UA's management has managed to find "loopholes" to allow UA to continue to fly. Now UA is on artificial life suppo
70 Yyz717 : I don't have a dislike of UA at all. I have flown them often. I am just not impressed with their financial performance, the fault of which lies not j
71 Yyz717 : Well managed airlines (indeed, all co's in general) will have effective checks and balances to tighten up on budgets and reduce capital spending when
72 1MillionFlyer : Equity financing is technically debt just like liabilities on a balance sheet they both show against assets. How they finance doesn't mean much at th
73 1MillionFlyer : Unless you were on the management team, you have no idea what happened.
74 Yyz717 : Equity financing is a sign of confidence from independent money managers that UA is on the right track and is capable of investment grade returns. Cl
75 1MillionFlyer : last post on this topic since you are obviously clueless about corporate finance in this situation. Happy ignorant posting.
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