Bankruptcy Ii
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deltawatch
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- Aug 20, 2002
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I look for UAL to buy U at a bargain basement price, Grab its key assets and throw the rest to the wind. Just like Continental did Eastern.
Since I'm busy stirring pots for Turkey day, I figured why not stir the pot here.
IF US assesst went for "bargain basement" prices, would'nt it make more sense that the new UAL Co. susidiary "Ted", would jump at the US assessts rather than UAL itself? It seems to me that many routes would fit perfectly into their business plan. With a significantly lower pay scale for "Ted" employees (theoretically rolled out over time so that current UAL employees don't recieve additional pay cuts), then they could offer employment carry over to any displaced US employees while still realizing the payrate reduction benefit almost immediately. Any thoughts?
IF US assesst went for "bargain basement" prices, would'nt it make more sense that the new UAL Co. susidiary "Ted", would jump at the US assessts rather than UAL itself? It seems to me that many routes would fit perfectly into their business plan. With a significantly lower pay scale for "Ted" employees (theoretically rolled out over time so that current UAL employees don't recieve additional pay cuts), then they could offer employment carry over to any displaced US employees while still realizing the payrate reduction benefit almost immediately. Any thoughts?
767jetz
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- Aug 20, 2002
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I think you misunderstand the TED product. Ted is not a seperate entity or subsidiary of UAL. TED is part of United. Same employees. Same seniority list. Same contract. Same work rules. Same pay. Different marketing. Different seat configuration. Different usage of aircraft. Different product. Same airline.HJM said:
If UAL buys any part of another airline, it becomes part of United Airlines. Then it can be used in any market they choose. They could call it mainline or TED. It's all the same.
Delldude, you've been reading too much of a certain person's ramblings. UAL has $2.5 bil in cash as of the end of Oct, $1.9 bil unencumbered. There is a DIP loan of just over $700 mil. If UAL didn't get exit financing, UAL would still have more than $1.7 bil cash, $1.1 bil unencumbered. Not great, but enough to emerge without a dime of exit financing.delldude said:
U, last time I checked, has $1.9 bil in cash. I don't know how much is unencumbered; I think it's somewhere around $1.7 bil. Based on that amount of cash on hand, even if U started to burn $100 mil in cash/mo (I don't see that happening), U wouldn't be looking at another trip to BK court for another year.
Bottom line for UAL: UAL won't have any problems emerging from chap 11. UAL will emerge after UAL management has milked everything that they can out of being in chap 11.
Bottom line for U: U will be an independent entity without any threat of entering into chap 11 for some time to come.
BoeingBoy
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- Nov 9, 2003
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iflyjetz,
Don't know about UAL's financing but here's US's numbers:
Cash and cash equivalents and Short-term investments totaled $1.38 billion (3q03).
Without digging around the 'net, I believe the cash & cash equivalents was $1.1+ billion.
The ATSB loan guarantee requires about $1.07 billion cash & cash equivalents thru 6/04 & $700+ million thereafter. If this requirement is not met, the lenders can demand full payment of the loan.
I personally think (no "highly placed sources" for me) that Siegel's call for $200-300 million additional savings is to insure that US meets the above requirement thru June 04.
As a note, if we go chapter 7, there will be no crumbs to pick over - everything on the property is either leased or has liens on it.
Don't know about UAL's financing but here's US's numbers:
Cash and cash equivalents and Short-term investments totaled $1.38 billion (3q03).
Without digging around the 'net, I believe the cash & cash equivalents was $1.1+ billion.
The ATSB loan guarantee requires about $1.07 billion cash & cash equivalents thru 6/04 & $700+ million thereafter. If this requirement is not met, the lenders can demand full payment of the loan.
I personally think (no "highly placed sources" for me) that Siegel's call for $200-300 million additional savings is to insure that US meets the above requirement thru June 04.
As a note, if we go chapter 7, there will be no crumbs to pick over - everything on the property is either leased or has liens on it.
Bragging about who has more cash on hand restricted or unrestricted is worthless without a mention of how much debt is due in the near term. When a debt comes due that can't be refinanced it works havoc on cash balances. Look how much effort ATA has been making trying to refinance bonds due in the near future. Same may apply to UAL or U as well. Anybody have info on that?
BoeingBoy
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This may be some help:
U's cash contractual obligations as of September 30, 2003 (dollars in millions):
Remainder of 2003: $545
2004 $3,005
2005 $1,995
2006 $1,577
2007 $1,234
Beyond 2007 $7,078
A large chunk of these thru 2005 is aircraft purchase commitments.
U's cash contractual obligations as of September 30, 2003 (dollars in millions):
Remainder of 2003: $545
2004 $3,005
2005 $1,995
2006 $1,577
2007 $1,234
Beyond 2007 $7,078
A large chunk of these thru 2005 is aircraft purchase commitments.
Here's from U's Q3 report:BoeingBoy said:
US Airways Group ended the quarter with total restricted and unrestricted cash of approximately $1.94 billion, including $1.38 billion in unrestricted cash, cash equivalents and short-term investments.
Link: http://www.usairways.com/about/press/nw_03_1021.htm
BWIPilot, there was no bragging as to cash positions of either company; I was just trying to point out these dire predictions for both companies is overstated. I don't see chap 7 in the near term for either company.
As for debt coming due for each company, it's really a question of what interest rate the airline has to pay vs being able to obtain a loan. Even TWA was able to refinance debt in its final days, in spite of not turning a profit for something like 20 quarters.
Fatherknowsbest
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- Sep 19, 2003
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IMHO, the question really isn't when does "U" run out of cash. The question is, when does Bronner decide to pull the plug so that he doesn't loose his investment?
Remember none other than Warren Buffet said his worst investment ever was the investment he made into "U". I seem to remember Schofield and the BOD changing his stock from common to preferred so he would be more likely to get his money back....But Warren to my knowledge never backed off the statement.
The Bronner thing is what will probably will finish this Airline. At least TexasPacific Group had plenty of experience in running Airlines and could have helped Siegel with a plan! Bronner has much experience running money funds and golf courses, it IS obvious that he is in over his head. Don't you all recall his statements about prop planes being unsafe and how they needed to be replaced asap (You don't ever trash your current product in public - when it will cost you lost revenue!)
He doesn't even seem to realize that this duo of Dave & Dave is bringing the fat lady to the concert hall much faster than we all thought.
Bronner will probably tire of this whole airline thing and just close it down. That is my biggest fear. We can get rid of 1 Dave maybe, but we will never be rid of both until we are history.
Would love to be wrong on this but if you just look around these 2 guys are lost and clueless!
Remember none other than Warren Buffet said his worst investment ever was the investment he made into "U". I seem to remember Schofield and the BOD changing his stock from common to preferred so he would be more likely to get his money back....But Warren to my knowledge never backed off the statement.
The Bronner thing is what will probably will finish this Airline. At least TexasPacific Group had plenty of experience in running Airlines and could have helped Siegel with a plan! Bronner has much experience running money funds and golf courses, it IS obvious that he is in over his head. Don't you all recall his statements about prop planes being unsafe and how they needed to be replaced asap (You don't ever trash your current product in public - when it will cost you lost revenue!)
He doesn't even seem to realize that this duo of Dave & Dave is bringing the fat lady to the concert hall much faster than we all thought.
Bronner will probably tire of this whole airline thing and just close it down. That is my biggest fear. We can get rid of 1 Dave maybe, but we will never be rid of both until we are history.
Would love to be wrong on this but if you just look around these 2 guys are lost and clueless!
N513AU
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- Aug 20, 2002
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Random thoughts....767jetz said:
CAN WE SAY M-E-T-R-O-J-E-T ? Obviously UAL's fine management team hasn't learned that painting airplanes and marketing them as wanna-be LUV, JUST DOESN"T WORK. Why? Because LUV treats there employees right - it'll be the same disaffected, crapped on and overwork/underpaid United employees....Rising, my a$$.
I think naming the airline within an airline "Ted" is, well, frankly downright retarded. Maybe we should bring back MetroJet, but with the Alabama theme? Put the stars n bars on the tail and call it BillyBob. But, we all know that "Ted" is just United without "you and I". It's another dirty little scam to kick us all on the street.
What we need is massive labor unrest. Why in the hell are airline flights operating on time this weekend, if at all? If our union leadership had half a set they would have unleashed carnage on Black Wednesday. Make it clear to Congress that this screwing of us workers must stop immediately. When it's quicker to walk to LAX to DCA than it is to fly and the economy grinds to a standstill, maybe then your congressman will listen to the plight of the working man!
We want regulation again - when I was in pax service, I wanted to tell every customer who b1tched about his center seat and peanuts - HE11, you asked for it.....at one time air travel was civilized, well now it's Greyhound with wings. $100 round trip to Florida! You are damn lucky you even have a seat to sit in - if the management had their way, they'd have subway rails and handstraps so people could stand in the aisle.
Unfortunately, safety is compromised daily and it's only a matter of time until more Alaksa Air incidents happen. I bet the 3rd world vendors that Bronner wants to use down in the Confederate States of America are a bastion of safety.
:angry:
