brons2
Posts: 2462
Joined: Tue Sep 25, 2001 1:02 pm

United Wants More Time For Plan

Wed Mar 12, 2003 5:16 am

From:
http://biz.yahoo.com/rb/030311/airlines_united_4.html


Reuters
United Wants Time to File Restructure Plan
Tuesday March 11, 1:44 pm ET

CHICAGO (Reuters) - UAL Corp. (NYSE:UAL - News), parent of bankrupt United Airlines, said it has asked a U.S. bankruptcy court judge to give it more time to file its reorganization plan to make sure it is well thought out.

In court documents filed on Monday, the No. 2 U.S. airline said it is seeking an additional 180 days from April 8 to file its plan. That would give the carrier until Oct. 6 to file, after which competing plans from creditors could be filed.

If UAL gets the extension, the airline would have until Dec. 5 to win approval for the plan from creditors and the court.

UAL filed the largest bankruptcy in aviation history on Dec. 9.

Bankruptcy judges often grant additional time to debtors to file restructuring plans in complex Chapter 11 cases. A spokesman for United said on Tuesday that requests for extensions are "routine."

"The debtors seek these extensions to avoid premature formulation of a Chapter 11 plan and to ensure that the formulated plan takes into account the interests of all the debtors, their employees, their creditors, and their estates," United attorneys said in court papers.

United is negotiating with its labor unions and aircraft financiers to reduce costs and meet separate deadlines on key financial targets set forth in its bankruptcy financing package.

The airline has said it will take the next step in voiding its labor contracts on March 17 if it cannot seal permanent deals with unions by that date.

United's proposed transformation plan, part of its overall reorganization plan, includes among other things the creation of a low-cost carrier. The low-cost concept has been opposed by unionized workers who object to salary scales and bargaining agreements that are separate from those for mainline employees.

US Airways Group (OTC BB:UAWGQ.OB - News), which filed for bankruptcy in August and submitted its reorganization plan to the court in December, has sought and won several extensions on its restructuring plan deadline. Its plan has yet to be approved by creditors.
Firings, if well done, are good for employee morale.
 
speedport
Posts: 269
Joined: Thu Sep 27, 2001 12:08 pm

RE: United Wants More Time For Plan

Wed Mar 12, 2003 6:02 am

The word to key in on here is exclusive. The ‘official’ reason for this request is that “Much work remains to be done.”

Could it be the reports of other groups developing alternate plans and financing are more credible than we have been lead to believe, and that United is seeking to buy more time for its planned LCC by preventing alternate plans from being filed with the court?

A clue to answering this question comes in the form of an admission, by United, that the all-important creditors committee is looking at other possibilities, all of which exclude the creation of a LCC. The pilot’s union for United put this way; “along with every critical stakeholder in this reorganization – the creditors, unions, banks and potential equity investors – ALPA remains skeptical of management’s business plan.”

United most likely will get the extension. Employee ownership at United is over; the unions no longer have special voting powers on the BOD. More important, though, is their 3 seats on the creditors committee giving them a position of influence there. That influence appears to be having an affect.

I sense a crack beginning to develop.
 
UALPHLCS
Posts: 3233
Joined: Thu Jun 28, 2001 5:50 am

RE: United Wants More Time For Plan

Wed Mar 12, 2003 7:03 am

US Airways Group (OTC BB:UAWGQ.OB - News), which filed for bankruptcy in August and submitted its reorganization plan to the court in December, has sought and won several extensions on its restructuring plan deadline. Its plan has yet to be approved by creditors.

Standard Operating Procedure
A little less Hooah, and a little more Dooah.
 
brons2
Posts: 2462
Joined: Tue Sep 25, 2001 1:02 pm

RE: United Wants More Time For Plan

Wed Mar 12, 2003 8:07 am

UALPHLCS: USAirways seemed to have a much better defined plan when they went Ch. 11. Seems like UAL is floundering about in the wilderness.
Firings, if well done, are good for employee morale.
 
UALPHLCS
Posts: 3233
Joined: Thu Jun 28, 2001 5:50 am

RE: United Wants More Time For Plan

Wed Mar 12, 2003 12:51 pm

In fairness to United's management, restructuring US Airways was probably not as big a challenge, because US Airways is "smaller and less complex," Neidl added. "United is much larger and more unwieldy."

That quote came from this article int he Philadelphia Inquirer:

http://www.philly.com/mld/philly/business/5347908.htm

While I agree that UA hasn't been as orderly. UA is also proposing much more than simply shirinking the company and cutting costs. UA's plans are more ambitious and look more at a competitive UA in Flush times as in lean times. US has dome a great job of lowering costs but have they fundementally changed the way airlines do buisness? In five years are the US unions going to be screaming for "their fair-share" again. They have only put off the inevitable change that most people in this forum are demanding of network carriers. UA is proposing a radical change. Something that has not een done in this scale ever before.

A little less Hooah, and a little more Dooah.