StevenUhl777
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Posts: 3281
Joined: Sun Jul 08, 2001 11:02 am

UA Reapplies For Atsb Loan

Wed Jun 23, 2004 12:46 pm

Just read on USA Today and MSNBC that though the amount is yet to be confirmed, UAL Corp. has resubmitted a revised application for just over $1B, a decrease of $500mm.

It is believed that UAL is now willing, unlike before, to seek an outside equity partner in its quest to reemerge from Ch. 11 protection.

This signifies a major shift in UA's plan, and I believe (hope) that the ATSB will consider this dramatic shift as positive, and grant UAL the loan guarantee. To reiterate, the ATSB is NOT writing UAL a check. They are simply acting as a co-signer on exit financing provided by JP Morgan and Citigroup.

Fortunately, as I theorized in other threads, UAL has not mentioned a word about its pensions, and has not signaled any intention to file a distress termination of its current plan. To do so would competely destroy any level of morale the employees have.

GO UNITED!

[Edited 2004-06-23 05:47:27]
And the winner for best actress is....REESE WITHERSPOON for 'Walk the Line'!!!!!!!!
 
aa777flyer
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RE: UA Reapplies For Atsb Loan

Wed Jun 23, 2004 12:49 pm

Any idea for a timeline of when the decision would be made on guarentee? When is UAL planning on exiting bankruptcy now. Will that be the final extention?
The TSA was created to make the post office look efficient!
 
StevenUhl777
Topic Author
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Joined: Sun Jul 08, 2001 11:02 am

RE: UA Reapplies For Atsb Loan

Wed Jun 23, 2004 1:08 pm

AA777Flyer:

The article(s) didn't say, but since they've reviewed most, if not all, of the what's already been submitted, it's just a matter of reviewing the new proposal. Along similar lines, Judge Wedoff has given UAL until 7/31 to file it's plan, and it's unlikely now that it will be extended.

Re: the ATSB loan, if they get shot down again, I doubt UAL will go back, and it's uncertain if the ATSB would grant a 4th opportunity.

CFO Frederick F. (Jake) Brace has stated that UAL will reemerge with or without the loan most likely this fall, but definitely by the end of 2004.

And the winner for best actress is....REESE WITHERSPOON for 'Walk the Line'!!!!!!!!
 
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flashmeister
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RE: UA Reapplies For Atsb Loan

Wed Jun 23, 2004 2:28 pm

This signifies a major shift in UA's plan, and I believe (hope) that the ATSB will consider this dramatic shift as positive, and grant UAL the loan guarantee. To reiterate, the ATSB is NOT writing UAL a check. They are simply acting as a co-signer on exit financing provided by JP Morgan and Citigroup.

Correct, except you're missing one very important point:

When UA agreed to reduce its loan guarantee request by $500 million, it said that it would get that money instead from the private capital markets. If it can scrape together $500 million with no guarantee, then there's no need for a cosigner at all.

The government needs to get out of the way of propping up carriers that don't have successful business plans. UA has been bleeding cash for years, and now all of the sudden they have a plan? Sorry, doesn't pass the smell test.

I don't care that the government isn't giving money -- although if past performance is an indicator, UA will happily piss away the billion plus in about a year, and then we WILL foot the bill. I don't want the government in the business trying to keep failed carriers flying. Period. Let the market take care of its own.

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