Tag Archives: chapter 11 reorganization

Bankruptcy judge approves AMR to send its restructuring and merger plan to its unsecured creditors

AMR Corporation (American Airlines) (Dallas/Fort Worth) has received an approval from the bankruptcy court judge, Sean Lane, to send its reorganization and merger plan to the unsecured creditors according to this report by Reuters. This reorganization is unique in that the creditors will receive a 3.5 percent share in the new company under the proposal. Usually creditors do not receive any value after a Chapter 11 reorganization. Secured creditors will be paid in full.

On June 7, 2013 AMR issued this statement:

AMR Corporation, the parent company of American Airlines, Inc.,  announced that the U.S. Bankruptcy Court for the Southern District of New York entered the order approving the Disclosure Statement filed in connection with the company’s proposed Plan of Reorganization (the Plan).  The Court also authorized American to begin soliciting votes on the Plan of Reorganization from creditors and stockholders. Solicitation packages will be distributed by June 20 and the voting deadline is July 29.  The hearing before the Court to consider confirmation of the Plan is scheduled for August 15, 2013.

The Plan is supported by the Official Committee of Unsecured Creditors.  Holders of approximately $1.6 billion of prepetition unsecured claims also have committed to vote to accept the Plan.

“This is a significant step forward in our efforts to complete the most successful restructuring in aviation history,” said Tom Horton, AMR’s chairman, president and CEO. “We’re in the home stretch of our restructuring and thanks to the hard work of our team, we are positioned to emerge a highly competitive, leading global airline focused on delivering the very best for our customers, our people, and our investors.”

The proposed Plan is to become effective concurrently with the consummation of a merger with US Airways.  The proposed merger is expected to maximize recoveries for all of the company’s economic stakeholders and the proposed Plan provides a recovery of 3.5% of the common stock (on an as-converted basis) of the combined company for holders of existing AMR equity securities, with the potential for such holders to receive additional shares.

Under the terms of the Merger Agreement with US Airways, stockholders of US Airways will receive one share of common stock of the combined company for each share of US Airways common stock then held. The aggregate number of shares of common stock of the combined company issuable to holders of US Airways equity instruments (including stockholders, holders of convertible notes, optionees, and holders of restricted stock units) will represent 28% of the diluted equity ownership of the combined company. The remaining 72% of the diluted equity ownership of the combined company will be issued under the Plan to AMR’s stakeholders, AMR’s labor unions, and certain employees of AMR.

Read the full report from Reuters: CLICK HERE

Copyright Photo: TMK Photography/AirlinersGallery.com.

American Airlines: AG Slide Show

AMR Corporation files its exit plan with the bankruptcy court

AMR Corporation (Dallas/Fort Worth), the parent of American Airlines (Dallas/Fort Worth) and American Eagle Airlines (Dallas/Fort Worth), yesterday filed its reorganization plan to exit its Chapter 11 reorganization with the bankruptcy court in New York. This is a necessary step towards a merger with US Airways (Phoenix). Under the plan, outgoing CEO Tom Horton would receive a $19.9 million severance plan. This amount was previously rejected by the bankruptcy judge Sean Lane.

The merger is expected to be closed in the third quarter. However there are many merger issues that are still unresolved.

Read the full report from Reuters: CLICK HERE

Copyright Photo: Tony Storck. Boeing 737-823 WL N803NN (msn 29566) of the “new American” arrives at Baltimore/Washington (Thurgood Marshall).

American Airlines: AG Slide Show

American asks the bankruptcy court for an extension to file its reorganization plan

American Airlines (AMR Corporation) (Dallas/Fort Worth), which is merging with US Airways (Phoenix), has asked the bankruptcy court to extend its deadline for submitting its Chapter 11 reorganization plan from April 15 to May 29.

Read the full report from Reuters: CLICK HERE

Copyright Photo: Mark Durbin. The first Boeing 767-300 to wear the new look is the pictured 767-323 ER N368AA (msn 25195) at San Francisco.

American Airlines: AG Slide Show

Southern Air is moving to Cincinnati, retires its last Boeing 747-200F freighter

Southern Air (2nd) is moving its corporate headquarters from Norwalk, CT to Cincinnati/Northern Kentucky International Airport (CVG) located in Covington, KY as part of its Chapter 11 reorganization. DHL, its largest customer, has a hub at CVG. As we previously reported, Southern Air and its holding company, Southern Air Holdings, Inc., filed for Chapter 11 bankruptcy protection and reorganization on September 28, 2012.

Read the full report from the kypost.com: CLICK HERE

In other news, Southern Air retired its last Boeing 747-200F freighter (N783SA) on January 5, 2013 as reported by ch-aviation.

Copyright Photo: Ton Jochems. Boeing 747-281F N783SA (msn 23919) is pictured on the ramp at Frankfurt prior to the retirement.

Southern Air (2nd) logo-1

Southern Air: AG Slide Show

Ryan International decides to liquidate, shuts down and terminates all employees

Ryan International Airlines (Rockford) yesterday (January 11) reversed its bankruptcy reorganization path from reorganization (Chapter 11) to liquidation (Chapter 7). The charter airline suddenly shut down and laid off all of its employees. The airline is still talking with prospective investors but it is a long shot for the airline to restart operations.

The airline went into Chapter 11 reorganization in March 2012. Previously the company was established by Ron Ryan in Wichita, KS and started operations on March 3, 1973 as Ryan Aviation. In 2005 the company was sold to the Rubloff Development Group which moved the company to Rockford (near Chicago) in 2006.

Read the full report from Channel 13 in Rockford: CLICK HERE

Top Copyright Photo: Bruce Drum. Boeing 757-2G5 N929RD (msn 23929) at Miami displays the 2004 livery of the company.

Tails of the World: AG Tails of the World

Ryan International logo-1

Ryan International Airlines: AG Slide Show

Bankruptcy judge rules AMR can void the American Airlines pilot’s contract

AMR Corporation (American Airlines) (Dallas/Fort Worth) now has what it has wanted. Bankruptcy Court Judge Lane has issued his decision which now permits AMR and American Airlines to unilaterally void its contract with its pilots, represented by the Allied Pilots Association. AMR has stated it needs labor stability and around 20 percent lower costs to emerge from its Chapter 11 reorganization. Who now will make the next move?

Read the full report from Reuters: CLICK HERE

Copyright Photo: Michael B. Ing. Boeing 777-223 ER N756AM (msn 30264) climbs away from Los Angeles International Airport.

American Airlines: 

After 44 years, American Airlines to have a new brand, with fuselage paint

American Airlines (Dallas/Fort Worth) is getting ready to introduce a new livery, probably now with some fuselage paint (at least for the 787s) and the new look is likely be introduced with the new Boeing 777-323 ERs on order which will usher in a large fleet overhaul. As we have been suggesting, it is time for a refresh after 44 years and the Chapter 11 reorganization process. The time is right for a new image. According to this article by the Wall Street Journal and several previous hints by AA management, a new brand is being developed. As the article states, the upcoming Boeing 787 Dreamliners, made of composite materials, are also forcing the issue to replace the all-metal “Silver Fleet”. The Dreamliners need fuselage paint. Will AA use a metallic silver paint to cover the 787s? American has for a long time, adopted the polished metal fuselage finish with just decorative paint on the fuselage.

Read the full article: CLICK HERE

Top Copyright Photo: Bruce Drum. When the Airbus A300B4-605R aircraft were first delivered to American in the 1968 livery, the fuselage was painted in this gray fuselage color to make it blend in with the all metal fleet. Airbus had recommended to the airline that it should paint the A300 fuselages. AA later found a way lto operate the A300s in the traditional bare metal finish. N18066 (msn 509) taxies to the runway at the Miami hub.

American Airlines: 

Bottom Copyright Photo: Wingnut. American in its early years as American Airways liked much bolder fuselage paint for its aircraft. A repainted and restored Stinson SRC-9C Reliant NC18407 (msn 5313) shows off the 1933 lightning bolt livery at Oshkosh. Will it return to a bolder look?

US Airways to file for antitrust immunity next month for a merger with American Airlines

US Airways (Phoenix) is planning to file the necessary paperwork with the antitrust regulators for a proposed merger with AMR Corporation (Dallas/Fort Worth), the bankrupt parent of American Airlines (Dallas/Fort Worth), according to this report by Reuters. US Airways believes such a filing would ease antitrust concerns about a possible merger. Meanwhile American’s management is proceeding with their own Chapter 11 reorganization as a stand-alone carrier despite undying pressure from the unsecured creditors and the unions to consider a merger with US Airways.

Read the full report: CLICK HERE

Top Copyright Photo: Jay Selman.

US Airways: 


Bottom Copyright Photo: Bruce Drum.