Alabama Retirement Head Threatens Liquidation

[OldGuyinPA]

Alabama can't even keep a football coach...

If you want to win, Mr. RSA, please rid yourself of anyone remotely associated with the past....Anybody that Wolfman and Rakeeeeeesh brought in and promoted.


Is Spring time around Christmas time?????

 

[airknocker]

Okay, here we are, Doc Bronner is in charge, Dave is trying to outsource every position from flight crews to all employees with their feet touching the ground, the unions act powerless, the creditors are wringing their hands, the judge is waiting for The Plan. This is not a winning hand we've been dealt. I realize that short of wishful feelings our only recourse is a updated resume or "sit down, buckle up and enjoy the ride". The present situation is totally out of our hands, the die was cast the day Wolf arrived and Dave&Doc will write the climax to this airline tale.

 

[N786P]

If you give a mouse,...or in this case a"Rat"..a cookie he"ll want a glass of milk too..or in this case the whole dairy farm.

 

[Rational Thought]

[blockquote]
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On 12/7/2002 4:22:34 PM MrMarky wrote:

If he takes U into Chapter 7, how does he recoup RSA's investment? He too, has a fudiciary responsibility. Maybe it's set up so that RSA would be first in line and there are sufficient assets to satisfy their claims--are they in it beyond the DIP financing? Chapter 7 makes Chapter 11 look like a walk in the park.
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[/blockquote]

DIP financing does have higher seniority than pre-banruptcy creditors. That being said, lower seniority creditors could sue if they felt that the DIP financer selected a course of action that lowered the return to subordinated debt. It is odd that the DIP financer would select CH7, usually that is suggested by lower seniority creditors who are concerned the company will blow through the DIP financing and then get liquidated, with the corresponding decrease in their claims.

However, Mr Marky, it would appear to me that US unions have limited power in negotiate here. The employees may have suffered financially, but they could always try and find a job elsewhere. And they could lose their jobs permanently, which would clearly be a financially negative outcome. Lastly, although the employees lose out, so do the debtholders who are unlikely to be made whole. And the equity is essentially worthless.

 

[MrMarky]

I'm no expert, but if he takes U into Chapter 7, how does he recoup RSA's investment? He too, has a fudiciary responsibility. Maybe it's set up so that RSA would be first in line and there are sufficient assets to satisfy their claims--are they invested in U beyond the DIP financing? Chapter 7 makes Chapter 11 look like a walk in the park.[BR][BR]In any event, it looks like the guy is showing his true colors--a nice shade of Lorenzo Yellow with some Icahn trim. If he is truly unhappy with the way the company is going, you can bet Dave Segal will be the first to go, and Bronner will replace Dave with himself.[BR][BR]This sabre rattling toward the employee groups who have already been bled dry is a bit over the top. Enough is enough.[BR][BR]Good luck to all of you at USAirways.

 

[MrMarky]

[BR][BR]
[BLOCKQUOTE][BR]----------------[BR]On 12/7/2002 4:44:13 PM Rational Thought wrote: [BR][BR][BR]
[BLOCKQUOTE][BR]DIP financing does have higher seniority than pre-banruptcy creditors. That being said, lower seniority creditors could sue if they felt that the DIP financer selected a course of action that lowered the return to subordinated debt. It is odd that the DIP financer would select CH7, usually that is suggested by lower seniority creditors who are concerned the company will blow through the DIP financing and then get liquidated, with the corresponding decrease in their claims.[BR][BR][FONT color=#ff3333]Hi Rational,[/FONT][BR][BR][FONT color=#ff3333]Thanks for the information. I appreciate the details. The part I'm still looking for is whether RSA is only in it as far as the DIP they provided (in return for effective control of the company) and which they would likely recover in a Chapter 7 situation, or whether RSA has deeper investments in U which would likely be jeopardized in a Chapter 7 filing, such as the leases they hold on aircraft, etc. Normally I wouldn't expect the aircraft leases to result in that much liability because you could repo them and lease them to someone else to recover your investment. But in this market, they'd be stuck with aircraft they can't place with another customer, and its corresponding value on the resale market has also diminished substantially. [BR][/FONT][BR]However, Mr Marky, it would appear to me that US unions have limited power in negotiate here. The employees may have suffered financially, but they could always try and find a job elsewhere. And they could lose their jobs permanently, which would clearly be a financially negative outcome. Lastly, although the employees lose out, so do the debtholders who are unlikely to be made whole. And the equity is essentially worthless.[BR][BR][FONT color=#ff3333]The debtholders accepted the risk when they extended credit to the company. The employees OTOH, are stakeholders, not debt holders. Their livlihood is on the line as is their investment in their ongoing employment and eventual retirement. They have a major stake in the health and success of the company. The debtholders have no such equivelant investment. They have either provided goods, services or funding in exchange for a profit and with risk factors clearly identified before hand. This won't put them out on the street unless they're as mismanaged as the airline. Excepting of course the stockholders, who have already been screwed. But they had plenty of warning and it's much easier to dump your poorly invested stock than it is to dump your job.[BR][BR]I don't know if Segal's agreement with unions regarding not seeking further concessions or abrogation of contracts in BK court in exchange for the concessions they have given the company is in the form of a legally binding contract, or just his assurances, but if he goes, does Bronner have to make good on any such obligation? Is this what the "S1113" letter addresses or is that something else??[BR][BR]Marky [BR][BR][/FONT][BR]----------------[/BLOCKQUOTE][/BLOCKQUOTE][BR][BR]

 

[pitguy]

What labor friendly means to some---->

Let me have my way with your spouse and let me beat your kids or I am going to CH-7 the company. How do you like me now?

 

[Winglet]

Employees and jobs will play no role in the equation. It's all about the money.

 

[autofixer]

RSA has most employees by the short hairs. They will negate union contracts via threat of Ch 7. The vast majority of employees WILL stay on at sub-industry work rules and pay. If RSA cannot coerce an employee group, they will simply go to the judge. It is ugly and there still is that UAL thing hanging out there not too far away.

 

[tug_slug]

[blockquote]
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On 12/7/2002 9:16:40 PM chipmunn wrote:

Union options? None of them are good except living to fight another day.

Chip
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[/blockquote]

Chip Ive read just about everything that youve posted. I have to admit Im very impressed with what you have had to say but lets face it, this dogs dead.

Its time to move on...

 

[chipmunn]

Per the DIP financing agreement RSA can terminate the transaction if US does not meet financial targets per the joint RSA/US December 6 statement.

DIP financing is a safe investment because if the debtor liquidates the DIP Financier goes to the top of the creditors list for repayment.

The question is will the unions participate or call Bronner's bluff?

Bronner is investing in US to obtain a capital gain, he will lose little sleep if US liquidates, thus RSA has little to lose.

David Bronner is now calling the shots and he's the only game in town. Either we play by his rules or the airline liquidates. Bronner seemed pretty straightforward in his New York Times interview regarding Chapter 7.

ALPA will likely hit its target number. The question is what will occur with the other unions?

I understand the IAM & Company negotiators will meet on Monday, which could be important, because on Thursday, December 12, the company will have its fourth Omnibus Hearing where we could see more unfolding news in bankruptcy court.

Options? Court ordered cuts, S.1113 letter cancellation, and/or defined benefit retirement plan "distressed terminations".

Union options? None of them are good except living to fight another day.

Chip

 

[Biffeman]

Chip, how many times do I have to tell you, since 1983 when 1113 was enacted no court has ever abrogated it!

 

[autofixer]

Just how much money does RSA have total...billions? I have seen many posts as to how the devil(Bronner) will be held accountable to the RSA if he loses his TINY investment in U. I fear $200 million is not too much to the RSA, otherwise why would they have risked the money? They felt the risk in a bankrupt, poorly run and managed piece of junk was worth the upside potential. Their risk was that of buying a junk bond; high risk, high yield. However, they (RSA) could afford to lose the money. My goodness, I am amazed that people will buy a ticket on a bankrupt air carrier. I would not.

 

[autofixer]

Biffeman, If you find the right court, there is always a first time.

 

[ForkTime2002]

[P]
[BLOCKQUOTE][BR]----------------[BR]On 12/7/2002 9:16:40 PM chipmunn wrote:
[P]Per the DIP financing agreement RSA can terminate the transaction if US does not meet financial targets per the joint RSA/US December 6 statement.[BR][BR]DIP financing is a safe investment because if the debtor liquidates the DIP Financier goes to the top of the creditors list for repayment.[BR][BR]The question is will the unions participate or call Bronner's bluff?[BR][BR]Bronner is investing in US to obtain a capital gain, he will lose little sleep if US liquidates, thus RSA has little to lose.[BR][BR]David Bronner is now calling the shots and he's the only game in town. Either we play by his rules or the airline liquidates. Bronner seemed pretty straightforward in his New York Times interview regarding Chapter 7.[BR][BR]ALPA will likely hit its target number. The question is what will occur with the other unions?[STRONG][FONT face="Times New Roman"] What do you think will happen with the other unions? alpos agreement is contingent on the other unions,i dont expect the apfa or the iam to play,do you?[/FONT][/STRONG][BR][BR]I understand the IAM & Company negotiators will meet on Monday, which could be important, because on Thursday, December 12, the company will have its fourth Omnibus Hearing where we could see more unfolding news in bankruptcy court.[BR][BR]Options? Court ordered cuts, S.1113 letter cancellation, and/or defined benefit retirement plan "distressed terminations".[BR][STRONG][FONT face="Times New Roman"]what?!? cancel the allmighty all powerful 1113 letter? that wouldnt be fair[/FONT][/STRONG][BR][BR]Union options? None of them are good except living to fight another day.[BR][STRONG][FONT face="Times New Roman"]Say we give again then they come back still again? how many times will people put up with this ****? "Give it up or else" eventually that isnt going to work chp.[BR][/FONT][/STRONG]Chip [/P]----------------[/BLOCKQUOTE]
[P][/P][STRONG][FONT face="Times New Roman"][/FONT][/STRONG]