ATSB:Need More Info To Decide On United Loan Request

Let's see....

Even though UAL hasn't declared chapter 11 reorganization (yet), it is de facto bankrupt as we speak.

It would then seem to me if the ATSB was under political orders to approve the loan guarantees, it would have done so by now, based on the fact that UAL has obtained significant labor concessions and creditor defferals.

Instead the board has added an additional request for information to probe deeper into UAL's long-term recovery plan to see if it will be sufficient. Once again it seems to me that this is far from a done deal. UAL still has its work cut out for itself, and the ATSB appears to acting appropriately as stewards of the taxpayers' money. UAL has not proven to them that they are a worthy credit risk despite their efforts thus far.
 
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  • #17
Does anyone honestly believe UA is going to be turned down for the ATSB loan guarantee? In the end, we will get the loan.

I'm hopeful that UAL can get the loan...but we shouldn't get ****y at this point. There is still much work to do and a lot of luck required to get this approved. Look at U, they have had conditional approval since spring and still haven't received money.
 
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On 11/8/2002 11:46:02 AM Speedbird wrote:

Let's see....

Even though UAL hasn't declared chapter 11 reorganization (yet), it is de facto bankrupt as we speak.

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What?! The ATSB wants more info. They are looking CLOSELY at all aspects of the plan and our books (something you should pray nobody EVER does at you PONZI organization).
 
Its not any different than the due dilligence any creditor would do.

Remember, the key criteria of success is to create a solid business case that UAL will not default. If the business plan (cost and revenue) is not robust enough to convince the board, UAL will not the approval.
 
I didn't mean to sound ****y about UA getting their loan. But do not compare US Airways situation with UA's. UA's revenue projections were much more conservative than US's, hence the need for US to get more cost cuts to meet the ATSB requirements. It is simply a mistake to make blanket comparisons of US's ATSB process and UA's. Two completely different animals. My opinion is that UA will get the loan. Yes, we'll have to dance through a few more hoops and demonstrate the ability to re-pay. And we will. There is A LOT going on behind the scenes that doesn't get mentioned in the press but is working in UA's favor. I'm confident we'll get conditional approval that will amount to an eventual guarantee of the $1.8 Billion in loans.
 
Busdvr:

Try not to get so upset by my post. By definition, UAL is currently performing as a bankrupt business, even if it hasn't declared so officially. If you don't want to take my word for it then go look it up in Webster's.

Bottom line, nobody owes UAL anything at this point, and they will have to prove everything going forward. Spare me the kool-aid induced prattle about UAL's long, proud history and their so-called vital role to the overall economy.

Boy, and you have the nerve to call my airline a ponzi scheme!
 
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On 11/8/2002 2:30:29 PM Speedbird wrote:

Try not to get so upset by my post. By definition, UAL is currently performing as a bankrupt business, even if it hasn't declared so officially. If you don't want to take my word for it then go look it up in Webster's.

Please elaberate. We are paying EVERY bill we are obligated to pay.

Bottom line, nobody owes UAL anything at this point, and they will have to prove everything going forward. Spare me the kool-aid induced prattle about UAL's long, proud history and their so-called vital role to the overall economy.

jetting Anna Nicole coast to coast is MUCH more important to the economy....

Boy, and you have the nerve to call my airline a ponzi scheme!

we shall see.



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Question for UAL777Flyer

Any word on if Lufthansa is going to provide payment funds to United? There was a spot in the press here about Mr. Weber being in discussions with UAL about payments. A rather nebulous term in the financial community at times so I am not sure how to interpret this. If so, will it be enough to stave off the ATSB and other creditors?
Frankly Lufthansa runs a rather impressive ship. I do not mean this disrespectfully but the legend of corporate raiders in America (and growing here on the continent unfortunatly) is rather wicked. If I had to nail my flag to the mast of another entity, one could do a lot worse than Lufthansa - though Weber's idea of actually growing and running a carrier and alliance do seem rather quaint these days.
 
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UAL has made so many strides and accomplished so much in the last several weeks and under Mr. Tilton in general. Of course, these strides and accomplishments were also made under the union coalition and at each work group respectively.

I think that UAL should be able to get the loan. And I agree that comparing UAL to U is not apples to apples. The timing of the loan to U has been affected by BK and debtor-in-possession financing. They also continue to make drastic swings to their business plan.

My point is that there should be absolutely no foregone conclusions here. That will only lead to taking the eye of the ball.

I believe in the end that UAL will get the loan but I also believe there will be several bumps along the way that could easily derail the process.
 
Busdrvr:[BR][BR]
[P]Okay, here is an excerpt of what I'm talking about. It comes from a PR this last week about your beloved airline's inability to pay it's debts on time:[BR][BR]The Kreditanstalt fuer Wiederaufbau obligations had been weighing on United, which feared it couldn't meet them without dangerously draining its cash cushion. The first obligation was repayment Nov. 17 of a $300 million revolving- credit facility, which will be refinanced and extended to 2007. The bank also holds $200 million of a $575 million aircraft-backed security due Dec. 2. The bank essentially refinanced its piece and rolled it over until 2007, leaving UAL to repay the $375 million that is owed to public bondholders.[BR][BR]UAL is now in a position where it must steal from Peter to pay Paul by negotiating extraordinary terms on the repayment of its debts. That by definition makes this airline bankrupt with regard to its financial obligations.[BR][BR]While it may not be CH. 11, it doesn't change the fact that this airline is still in big trouble as a going concern. If UAL does pull out of this dive, it will be severely hampered for many years to come trying to climb out of the huge financial hole it is still digging for itself. You better hope the next boom cycle lasts at least ten years before the industry roller coaster takes it next drop. [BR][BR]BTW, how many more decades before you get your business cards printed with the title captain?[/P]
 
As much as some UAL employees will not want to face the music, Speedbird is right. It comes down to how you define bankrupt. UAL cannot afford to pay its obligations and so is forced to renegotiate what it can no doubt at quite a premium, and to depend on a loan guarantee that may or may not come from the ATSB.

When I start using one credit card at exorbitant interest rates to pay off another credit card because I don't have the cash or income to actually pay the bills, and hope that my parents will co-sign for another loan so I can make next month's mortgage payment, that is pretty much my definition of bankrupt.
 
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