Official: AMR Bankrupt

[wrencher]

I'm continually amazed that the US people who regularly trash US mgmt now expect they will be the savior than another airline and THAT airline's creditors will want to run their airline.
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To somehow think that LCC with the lowest market capitalization in the US will win a contest for AA's hand when other carriers have multiples more value than LCC - in some cases up to TEN TIMES more value - is nothing short of an absence of reality.

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AA has an incredibly valuable franchise, even if they may cut 10-15% of their capacity in the next 6 months as they cut their losses and get rid of aircraft they do not wish to keep long term.
There is a list of airlines as long as your arm that can run AA as good as US could - including AA by itself after its employees endure massive cuts the size of which US employees have endured. If AA employees take cuts as deep as US employees have, AA will be swimming in revenue and have absolutely no need of US - and the creditors know that.
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Even if the creditors decide there is more value in selling out after AA is cleaned out than waiting for AA to return to health on its own, the fact is that every one of those other airlines can pull the same financing tricks that Doug Parker can do - and they have much more valuable companies to offer the creditors as collateral as well.
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The only way US could buy AA is with borrowed money. The deciding factor if it comes down to a choice between carriers is who can offer stock in their own company as well. IN a competition for AA vs any other airline, LCC will never have the market value to tilt the contest in its favor.
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You can take THAT to the bank.

So you think the workforce is going to be happy what about that?????????????

 

[700UW]

It's apparent the majority of you dont understand the Section 1113 process of bankruptcy.

The union and the company by law have to meet to negotiate, the Judge doesnt negotiate nor does he sit in on the process. He only rules on the motions in front of him. His primary responsibility is to the creditors and the company and to ensure the POR makes the company survive.

The process is outlined in the law, and if the there is no new CBA agreed to, the judge can order an abrogation and an imposition of the final offer, or order the parties to negotiate more.

I was on the NC at US for M&R and its not a pretty process and we got screwed when our CBA was abrogated and the judge had us vote on the final offer as he wanted labor peace. Subsequent rulings from the courts have outlawed the unions from striking upon an abrogation.

 

[WorldTraveler]

So you think the workforce is going to be happy what about that?????????????

there is no happiness anywhere in AA employees' near term future... but they are smart enough to not add the horrors of BK to an acquisition by another airline... and the creditors are smart enough to recognize that if you break the employees, the future of the business itself is at risk. There is no reason for the creditors to support an acquisition if a restructuring alone will do the job.
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AA has an opportunity to restructure on its own... if it pulls it off, as it very likely will do, then there will be no mergers or acquisitions.v

not sure what your point is, 700, but the legal process is not in question here. The question is what the creditors decide is in their best interest and whether the cuts AA employees will endure will be sufficient to turn the company around... I submit they will be BECAUSE of 1113 and therefore the need or likelihood for an acquisition is dramatically reduced.

 

[MCI transplant]

So you think the workforce is going to be happy what about that?????????????

<_< ----- Wrencher, you've been through this before. You should know that at this point, it don't matter if the workforce is happy about this or not! Good luck to you and all the exTWAers out there!

 

[swamt]

Just want to wish you guys at AA good luck. Hope all of you have prepared for this...

 

[AANOTOK]

Just want to wish you guys at AA good luck. Hope all of you have prepared for this...

Yep, calling my BK lawyer right now! :angry:

 

[Dont call me Shirley]

Happier days:

http://www.youtube.com/watch?v=Km5JGarqc8c&feature=results_video&playnext=1&list=PLB0F7919BE9B4A474

What will be AA's next "first"?

 

[RDU Jetblast]

MDW went Chapter 7 in 11/91 during a slide in air travel and furloughs and at least no hiring in the pilot job market for the next several years..

Actually, it was MDW II, Ch 7 after 9/11.

And, my experience is that groundlings will find comparable jobs. Let's face it, the more you make, and the more specialized you are, the more difficult it will be to find a replacement job of comparable pay. That goes for any job!

In any case, let's wish the best to those may experience the worst. It may just be the end of a job; not the end of the world!

 

[Jacobin777]

Are you flying non-rev?

Nope. Paid.

 

[Tom Bombadil]

I'd like to get to know ya!

 

[ContUNITEus]

I'm continually amazed that the US people who regularly trash US mgmt now expect US will be the savior for another airline and THAT other airline's creditors will want to run their airline.
.
To somehow think that LCC with the lowest market capitalization in the US will win a contest for AA's hand when other carriers have multiples more value than LCC - in some cases up to TEN TIMES more value - is nothing short of an absence of reality.
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Further, I have yet to hear a single AA employee say they want to be bought by US.... if AA has to be bought by someone else, the employees can very well influence the outcome....
US' last attempt at buying a bigger airline was thwarted by the vocal objections of DL mgmt and employees - you can bet AA employees would be even more interested in avoiding a long-term relationship with US.... a dozen other airlines could provide better employment outlook for AA employees than US - as well as better returns for the creditors.

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AA has an incredibly valuable franchise, even if they may cut 10-15% of their capacity in the next 6 months as they cut their losses and get rid of aircraft they do not wish to keep long term.
There is a list of airlines as long as your arm that can run AA as good as US could - including AA by itself after its employees endure massive cuts the size of which US employees have endured. If AA employees take cuts as deep as US employees have, AA will be swimming in profits and have absolutely no need of US - and the creditors know that.
.
Even if the creditors decide there is more value in selling out after AA is cleaned out than waiting for AA to return to health on its own, the fact is that every one of those other airlines can pull the same financing tricks that Doug Parker can do - and they have much more valuable companies to offer the creditors as collateral as well.
.
The only way US could buy AA is with borrowed money. The deciding factor if it comes down to a choice between carriers is who can offer stock in their own company as well. IN a competition for AA vs any other airline, LCC will never have the market value to tilt the contest in its favor.
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You can take THAT to the bank.

Who said that US was going to buy AA? HP didn't buy US. One ugly girl told a pretty one to get a little butch in bankruptcy court and to afterwards start a lesbian relationship with her. Somehow they got a baby called LCC - another "ugly girl," that was later left at the altar by a guy called UNITED.

AA is the only other big macho out there that is still single, and he doesn't care right now who he sticks it to.

LCC is in heat and desperately trying to pull sort of like a Kardashian or Britney style marriage with someone desperate enough to get back on the spotlight.

 

[Real tired]

It never works out better like this. I recall the TPA Hanger for US being shutdown without notice. Third shift showed up and were told to get their tools off the property. The lease on the hanger was terminated and given back to the city of TPA.

You are correct. And here, in what's left of PIT, we lost over 12,000 total jobs. And for Maintenance, just about every back shop was closed and farmed out, or moved to another station.

 

[Show me the money]

Everybody is running around and the sky is falling! What we haven't heard is something from the union. The ramp still has to vote on their deal and are we even going to meet in two weeks? If you think that this was done and the TWU had no idea you might still believe in Santa Claus. The TWU is already at work to keep as much dues as they can. Where is the press release from the union? Where is the message to the members? The company wants a no cost contract. We will see if this is going to be a group looking out for all the members or the biggest showing of I GOT MINE! The final straw was the pilots, I don't know if any one group can bring this back with the smallest amount of damage.

 

[FWAAA]

Everybody is running around and the sky is falling! What we haven't heard is something from the union. The ramp still has to vote on their deal and are we even going to meet in two weeks? If you think that this was done and the TWU had no idea you might still believe in Santa Claus. The TWU is already at work to keep as much dues as they can. Where is the press release from the union? Where is the message to the members? The company wants a no cost contract. We will see if this is going to be a group looking out for all the members or the biggest showing of I GOT MINE! The final straw was the pilots, I don't know if any one group can bring this back with the smallest amount of damage.

AA pulled the TA for fleet off the table.

 

[WorldTraveler]

Who said that US was going to buy AA? HP didn't buy US. One ugly girl told a pretty one to get a little butch in bankruptcy court and to afterwards start a lesbian relationship with her. Somehow they got a baby called LCC - another "ugly girl," that was later left at the altar by a guy called UNITED.

AA is the only other big macho out there that is still single, and he doesn't care right now who he sticks it to.

LCC is in heat and desperately trying to pull sort of like a Kardashian or Britney style marriage with someone desperate enough to get back on the spotlight.

your last phrase is what throws the whole deal out the window.... AA isn't desperate enough to get back in the spotlight via US.
BK is designed to allow AMR to restructure on its own; they have the tools to do what they need to do to turn the company around and the law gives THEM the advantage - exclusivity.
If January rolls around and AA has made no signs of cleaning itself up, then we can return to your discussion.... but I can assure you that if the creditors have to start looking for someone to buy out AMR, they will look high and wide - and LCC will have to compete on the basis of the business proposal it can make - including cash out of its own bank accounts and stock from its own treasury... against other investors/companies who will be expected to do the same thing.
There is no such thing as a "company is married" and therefore ineligible for any further marriages or asset acquisitions. ANY airline could conceivably buy AMR subject to antitrust regulations that would prevent a merger... and on that note, you might want to remember that the DOJ was very close to blocking the slot deal because US now controls more than 50% of the slots at DCA... unless US is willing to walk away from AA's DCA slots and fly AA's schedule with the slots US already has, there will be no merging of AA-US operations at DCA, just as there can be no merger or asset acquisition involving DL and AA at LGA... and probably none involving AA or UA at ORD... other than those pretty obvious overlaps, most every other combination is on the table.... if it comes down to asset acquisitions or mergers....

but the OVERWHELMING evidence is that AA will be able to successfully restructure and re-emerge on its own.