From AIr Transport World On-line
ATA's disclosure statement approved, Chapter 11 exit near
Friday December 16, 2005
ATA Holdings, parent of ATA airlines, took a major step toward exiting bankruptcy after the US Bankruptcy Court approved its disclosure statement, which specifies how it intends to finance its restructuring as well as its future operating plan. The reorganization plan calls for an investment of $120 million from MatlinPatterson, including $30 million in DIP financing that will be converted to equity upon emergence, up to $70 million in the form of equity and a standby commitment to purchase shares not taken up by creditors, and $20 million in exit financing (ATWOnline, Nov. 15). ATA intends to retain some scheduled services as well as its military and commercial charter operations and has a restructured seven-year codeshare arrangement with Southwest Airlines that will provide for, among other things, "the sale of certain ATA local flights through Southwest's distribution channels."