Delta Lenders Ask for More Time for Debt Waivers
A group of investors said on Tuesday they would block plans by Delta
Air Lines Inc. to amend lending
agreements because it needs more time to fully understand the troubled
airline's restructuring proposals, Reuters reported. Delta is struggling
with high jet fuel prices, high labor costs and high borrowing costs.
Domestically, it has had trouble competing against low-cost carriers
like Southwest Airlines. A committee representing investors in $1.3
billion of Delta's secured notes said they need more time to understand
Delta's overall business plan, financial condition and restructuring
plan before agreeing to change the lending agreements known as
indentures. To respond without knowing Delta's entire restructuring plan
would be 'imprudent,' the committee said in a statement, the newswire
reported.
UNITED
AIRLINES
United Airlines U.K.
Staff
Call Off Aug. 27 Strike
United Airlines ground staff at
London 's Heathrow airport
have called off a strike set for Aug. 27 after a pay deal was reached
with the airline, Reuters reported. The Transport & General Workers
Union (TGWU) said it will be recommending the new pay offer to members
in a ballot to be held next week. 'We believe the agreement better
reflects the role of our members at Heathrow and will ensure they
receive pay they are entitled to,' Oliver Richardson, TGWU Regional
Industrial Organiser, said in a statement. Around 700 United Airlines
baggage handlers and check-in staff at Heathrow had planned to strike
for 24 hours starting on Friday. United is 20 months into a complex
bankruptcy case, the newswire reported.
Some Light Shed on Panel Decision to Deny Aid to United
Members of a federal loan board said they felt that United Airlines'
bid for $1.6 billion in assistance
was based on a faulty business plan and they believed that helping the
airline could hurt the rest of the industry, newly released minutes of
the board's deliberations show, the New York Timesreported.
The minutes were posted yesterday on the Air Transportation
Stabilization Board's Web site. They provide a view into two meetings in
June, when United's second and third applications for federal assistance
were turned down, forcing the airline to seek private financing. In
turning down United's application, the board said that the company could
find financing elsewhere and that it had not proved that the loan was
needed to maintain a viable air transportation system. The minutes,
however, show that members of the board also debated the financial
underpinnings of United's case, the newspaper reported.
Banks May Deny WorldCom
Financials Falsified
the phone company's 2002 collapse, have unveiled an unusual legal tactic
-- denying that any WorldCom financial reports were false, the
Wall
Street Journal said on Wednesday. The newspaper said Jay Kasner,
a
partner at the law firm Skadden Armps Slate Meagher & Flom LLP who
represents the banks, revealed the position in an August 18
teleconference hearing with U.S. District Judge Denise Cote, who is
presiding over the case. The newspaper cited a court transcript of the
hearing for that position.
JTI-Macdonald Files for
Court Protection
Japan Tobacco's JTI-Macdonald
Corp. unit filed for court protection from creditors on Tuesday in a
fight with Quebec tax
officials, who have accused the firm of smuggling to avoid more than $1
billion in taxes, Reuters reported. Revenue
Quebec has demanded the
Canadian cigarette manufacturer pay C$1.36 billion ($1.05 billion), and
JTI-Macdonald said it needed court protection to avoid bankruptcy. The
company, headquartered in
Toronto but with
manufacturing operations in Montreal, said
Quebec had also moved to
seize cash from its customers, which would have deprived it of 40
percent of its Canada-wide revenues. JTI-Macdonald said business will
continue as usual while under court protection. The filing was made in
Ontario and the
preliminary hearing in the case is not scheduled until next April, the
newswire reported.
Avianca Says Could Exit
Bankruptcy after Oct. 14
Avianca could begin to emerge
from bankruptcy in October after winning approval on Tuesday from
creditors and a
U.S. judge
for its proposed sale to a Brazilian company, the Colombian airline
said, Reuters reported. A creditors' committee voted unanimously in
favor of a reorganization plan based on the sale to
Brazil's
Sinergy and a New York
bankruptcy judge overseeing the proceedings said it was legal, Avianca
said in a press statement. 'The hearing to confirm the plan was set for
Oct. 14. Once the decision is approved, the company must complete the
documents and take the actions required to emerge from Chapter 11,' the
airlines said in the statement.
Mergers Raise Bank Profits,
Say IMF Economists
Bank mergers in emerging market
economies increase profits and sharply reduce risks of bankruptcy,
according to research by International Monetary Fund economists
published on Tuesday, Reuters reported. The economists said the
international banking industry, particularly in emerging markets, had
been dramatically changed through consolidation. This development had
sparked interest in the consequences of mergers on the performances of
banks, they said, the newswire reported.
Oglebay Norton Bidders May
Increase Offer To $500 Million
A consortium of purchasers
looking to buy Oglebay Norton Co. is likely this week to increase its
offer for the bankrupt mineral supplier by about $50 million to some
$500 million, a lawyer for the group said on Tuesday, Reuters reported.
The consortium was ready to make the offer pending the outcome of a
meeting in Cleveland
with company representatives, creditors and other parties, according to
consortium lawyer Tom Coffey, of
Cleveland's Tucker, Ellis
& West. The offer would come as the 150-year-old Cleveland-based
company is seeking creditor approval for its own plan to pay creditors
and emerge from bankruptcy protection as a private company. The plan,
which the company hopes will be approved in September, will essentially
give bondholders 100 percent of the equity in the reorganized company,
the newswire reported.
Adelphia: Rigas Family Owes
It $3.23 Billion
Adelphia Communications Corp.
asked U.S. bankruptcy court to order its founding Rigas family to pay
back $3.23
billion it says the family owes the company, court papers show, Reuters
reported. The papers were filed on Friday in a racketeering lawsuit
against the family that began in July 2002. The original suit did not
specify the damages sought. The filing came less than two months after a
jury found Adelphia founder John Rigas and his son, former CFO Timothy
Rigas, guilty of fraud and conspiracy in the cable TV company's
multibillion-dollar collapse, the newswire reported.