Tag Archives: Southern Air (2nd)

Southern Air eliminates all of its long-term debt with a debt-for-equity exchange

Southern Air (2nd) (DHL) (Cincinnati) has issued this statement about its restructuring process:

Southern Air Holdings, Inc. (SAHI) has completed a debt-to-equity exchange that eliminates all of the company’s long-term debt, enabling SAHI to significantly enhance its strategic position and growth plans.

The consensual secured debt-to-preferred equity exchange satisfies approximately $90 million in senior secured term debt by issuing to its former term lenders a new class of preferred stock and warrants. The newly issued preferred stock is non-voting and non-convertible, and provides for an annual stated yield accruing in kind (not in cash), and a liquidation preference over common shares. The exchange transaction was approved by the United States Department of Transportation and by 100% of the participating term loan lenders. In addition to the debt-for-preferred equity exchange, SAHI’s lenders agreed to renew and increase to $20 million a working capital line of credit in favor of various SAHI affiliates.

“The completion of this debt-for-equity exchange sets a new stage for growth in our air cargo platforms,” said SAHI and Worldwide CEO Dan McHugh. “Southern Air now has a clean balance sheet and no long term debt. With positive cash flow, we are poised to grow our existing 777 and 737 programs with global logistics leader DHL Express and other global customers, and in view of the closing of our acquisition of 767 carrier Florida West International Airways (Florida West), Worldwide is strengthening and expanding its highly reliable, cost efficient and customer-oriented ACMI, CMI and other air cargo services.”

Worldwide recently announced its plans to acquire Miami-based Florida West, a U.S. all cargo carrier operating 767 aircraft.

McHugh added, “Our lenders’ willingness to convert all of their term debt to preferred equity demonstrates a firm commitment to SAHI’s management vision, strategic positioning and growth plans, and we greatly appreciate their support in this debt conversion process.”

SAHI was advised in the transaction by the investment banking firm Imperial Capital and the law firm Berger Singerman.

Southern Air currently operates four Boeing 777-200 freighters on an around-the-world basis for the leading global express delivery provider DHL. Southern Air also operates five Boeing 737 aircraft for DHL, flying key routes to support DHL’s North American air networks.

All Boeing 747s have been retired.

 

Copyright Photo: Chris Sands/AirlinersGallery.com. Southern Air now operates five Boeing 737-400 freighters in DHL colors including ex-LOT 737-45D N495SA (msn 27157) at Calgary.

DHL-Southern Air aircraft slide show: AG Airline Slide Show

Southern Air aircraft slide show: AG Airline Slide Show

AG Designed by photographers

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Southern Air takes delivery of its first Boeing 737-400F freighter for DHL

Microsoft Word – 737 DHL Express Southern Air Press Release_FINAL

Southern Air (2nd) logo-1

Southern Air (2nd) (Cincinnati) has taken delivery of its first Boeing 737-400F freighter (737-4Q3, N493SA, msn 29487). The former JTA airliner was converted to a freighter by Commercial Jet. The freighter will be operated for DHL.

DHL is adding five Boeing 737-400 aircraft to expand its routes within the Americas as part of a multi-year service agreement with US cargo carrier Southern Air. The five aircraft will be placed into service from April through August.

Current planned routes include flights from Caracas (CCS), Venezuela, to Barbados (BGI) and Trinidad and Tobago (POS) in the Caribbean, as well as from Caracas to Bogota (BOG), Colombia, and Panama (PTY). In the United States, the new aircraft will add flights from the Cincinnati hub (CVG) to several cities along the Northeast and Midwest, including Philadelphia (PHL), Hartford (BDL) and St. Louis (STL).

Southern Air also operates four Boeing 777F freighters for DHL.

Southern Air: AG Slide Show

 

Southern Air emerges from Chapter 11 bankruptcy

Southern Air Holdings, Inc. (Southern Air 2nd) (Cincinnati) announced yesterday (April 15) that it has emerged from Chapter 11, having completed its financial restructuring.

Daniel J. McHugh, Southern Air CEO, said, “We have emerged from this restructuring process with substantially less debt, significantly improved operations and resources, and financial flexibility as a well-capitalized global air cargo carrier.  Today, we are well-positioned both financially and operationally to continue to build Southern Air for the long-term benefit of our customers, suppliers, business partners, crewmembers and employees.  From our new headquarters at the Cincinnati/Northern Kentucky International Airport, our largest air operating hub, we are even better able to grow profitably, delivering the highest quality services to our customers and meeting and exceeding their air cargo needs.”

Southern Air entered Chapter 11 on September 28, 2012, and emerged from the process on April 15, 2013, after meeting all closing conditions to the Company’s Plan of Reorganization. The Plan was confirmed by the U.S. Bankruptcy Court in Wilmington, Delaware on March 14, 2013.

Copyright Photo: Ton Jochems. Boeing 747-4EVF ER N558CL (msn 35171) prepares to taxi to the runway at Amsterdam.

Southern Air: AG Slide Show

TNT Express to cut 4,000 jobs and will focus on Europe

TNT Express (Hoofddorp), the parent of TNT Airways (Liege), announced today an extensive reorganization plan to go it alone after its takeover by UPS was rejected by the European Commission. The downsizing will result in a loss of 4,000 jobs as it will now concentrate on serving mainly its European routes. The struggling company needs to save approximately $286 million by 2015.

Read the analysis by Reuters: CLICK HERE

Read the official statement by the company: CLICK HERE

Copyright Photo: Ole Simon. Some of the long-range aircraft are likely to be dropped from the fleet with this downsizing. Operated by Southern Air for TNT Airways, Boeing 777-FHT N778SA (msn 39286) prepares to touch down at Dubai International Airport.

TNT: AG Slide Show

Southern Air’s Chapter 11 reorganization plan approved by the bankruptcy court

Southern Air Holdings, Inc. (Southern Air 2nd) (Cincinnati) has announced that it has received confirmation of its “pre-arranged” Plan of Reorganization (Plan) from the U.S. Bankruptcy Court in Wilmington, Delaware, which has been overseeing the Company’s Chapter 11 proceedings following its voluntary filing on September 28, 2012. The Plan received substantial support from key secured creditors as well as unsecured creditors.  The confirmation clears the way for Southern Air to emerge from its court-supervised financial restructuring as expected, within the next few weeks.

Daniel J. McHugh, Southern Air CEO, said, “We are very pleased to receive court approval of our Plan of Reorganization and hope to exit Chapter 11 in just a matter of weeks.  This was a critical part of our overall transformation. We have used this process to dramatically change and improve our capital structure, substantially reduce our debt and other legacy costs, strengthen our balance sheet, and enhance our competitiveness with new financial flexibility.

“We will emerge as a well capitalized carrier delivering safe, high quality air cargo services. As part of our strategic transformation, we have realigned our operations and capabilities and transitioned to a modern, fuel-efficient fleet of 777s and 747-400s serving global customers. Our operations and corporate activities are now in Northern Kentucky (the Cincinnati airport) near our largest hub of activity where we are even better able to satisfy the needs of our customers and grow our business for the long term to benefit our business partners and employees for years to come.

“It is thanks to the hard work and dedication of the Southern Air team and the support of our lenders and business partners that we have been able to move through this process successfully, fulfilling customer requirements as scheduled and providing high quality air cargo services without interruption. As a result of our transformation, Southern Air is better positioned for the future both financially and operationally to grow profitably as an air cargo industry leader,” concluded McHugh.

Copyright Photo: Michael B. Ing. Southern Air is now concentrating its future around the more fuel efficient Boeing 747-400 and the 777 and its growing relationship with DHL. Boeing 747-4F6 (F) N469AC (msn 27602) is pictured on final approach to Los Angeles International Airport.

Southern Air: 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

UPS to drop its bid to acquire TNT Express due to expected EC disapproval

United Parcel Service Inc (UPS) (UPS Airlines) (Atlanta and Louisville) will drop its bid to acquire TNT Express N.V. (Hoofddorp) because it now expects the European Commission (EC) to deny the acquisition.

On March 19, 2012, UPS announced its intention to acquire TNT Express for $6.7 billion. On September 5, 2012, UPS announced it expected to close the deal in early 2013 subject to EC approval.

UPS will pay TNT a termination fee in the amount of EUR 200 million.

TNT Airways (Liege) is a subsidiary of TNT Express. TNT is now expected to remain independent.

UPS issued the following statement:

United Parcel Service, Inc. announced today (January 14) the European Commission (EC) has informed UPS and TNT Express that it is working on a decision to prohibit the proposed acquisition of TNT Express.

UPS submitted an initial remedies proposal on November 29, 2012 and subsequently revised the proposal twice. UPS began the competitive review process with the EC in March 2012.

Scott Davis, UPS Chairman and CEO said, “We are extremely disappointed with the EC’s position. We proposed significant and tangible remedies designed to address the EC’s concerns with the transaction. The combined company would have been transformative for the logistics industry, bringing meaningful benefits to consumers and customers around the world, while supporting growth in Europe in particular.”

Upon prohibition by the EC, the Offer Condition relating to EU Competition Clearance will not be fulfilled and UPS will pay TNT a termination fee in the amount of EUR 200 million and will withdraw the Offer.

Further announcements will be made once the European Commission has issued its formal decision. The decision is expected to be adopted formally in the coming weeks.

Top Copyright Photo: Michael B. Ing. Boeing 747-44AF N572UP (msn 35669) climbs away from Anchorage International Airport (ANC).

UPS: AG Slide Show

TNT: AG Slide Show

Bottom Copyright Photo: Rainer Bexten. Southern Air’s Boeing 777-FHT N778SA (msn 39286) arrives at the Liege, Belgium sorting facility.