Ual Bankruptcy Exit

[Busdrvr]

The low value given to unsecured creditors (4-7%) is far more problematic than the loss of value to stockholders. UA employees are getting something back in return for their loss of stock value but everyone else does get screwed as was fully expected. However, 7% is very low value for unsecured creditors and there is no assurance that they will accept the POR, esp. since they will be given the share in stock. It is possible that the POR will be approved solely because most of UAL's creditors committee is composed of secured creditors who will come out of this OK.

[post="297873"][/post]​

just a little perspective on the payout for the Unsecured creditors. First, the bonds probably haven't been worth more than about 7% for quite a while. Second, that range assumes a max market cap in the neighborhood of 2.5 billion. If the plan actually works and the company has annual net profits in the 1 billion range in a few years, then a P/E of 10 would yield a market cap of 10 billion, or 4 times the current estimated max market cap. Extrapolate from there.

 

[Bulscu]