Us Airways Reaches $125 Mln Deal For Restructuring

[USA320Pilot]

According to the Charlotte Observer, in Air Wisconsin, US Airways has found a partner that likely views it as a potential savior. Air Wisconsin's decision to invest in US Airways might have been triggered by pressure from its current partner, United Airlines, which has been pushing its regional affiliates to lower their fees. That has led some of those carriers to seek alternatives. In November, Air Wisconsin learned its contract with United was being put out for lower bids as part of United's bankruptcy reorganization. This month, United delivered another blow by asking 15 companies to bid on ground-handling currently performed by Air Wisconsin at 23 airports, Aviation Daily reported.

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The Washington Post noted that US Airways continues to seek additional financing. Bids from other investors are not limited by the agreement reached yesterday by Eastshore. Other bidders would have to submit their proposals by March 15, which is the deadline for US Airways to submit its reorganization plan to the bankruptcy court. What remains unclear is how the agreement with Eastshore will affect the percentage of US Airways that will remain in the hands of its largest investor, Retirement Systems of Alabama. The airline's reorganization plan, which must be approved by the bankruptcy court, will detail its ownership.

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Regards,

USA320Pilot

 

[FM2436]

It's a sign of the times that a "regional" airline is bailing out a "major" airline. But the financing is great, things could really be looking up.

[post="249206"][/post]​

Kinda like K-Mart buying Sears.

 

[Rico]

Or more far-fetched, PDT and PSA could be bought and merged into AWA, forming a single, exclusive entity like ExpressJet.

Yeah, I thought of this concept too, and labeled it the " I will gladly pay you tuesday for a hamburger today" theory.

135 Mill now, to get past the toughest part (lowest cash level) of BK for US Airways, and then upon emergence PSA and PDT go over to AWAC. PSA would be a good match obviously, and AWAC used to operate DHC-8s a long long time ago.

But who knows. This whole thing came out of left field, so anyone's guess its as good as the others.

But yeah, it is real interesting that AWAC is just about the same size as what Mesa, CHQ, and TSA operate for U.

I personally think U and UAL are working together closer on this than what many think, and a swap of each airlines express carriers to provide UAL with lower cost regional feed, and U with financing does not seem like a deal either carrier would mind.

Who knows, like I said, this is hard to guess at. But fun to try.

 

[autofixer]

Yeah, this thing has that smell of UAL/U all over it. There has to be more going on than anyone on this board can know. Time will tell.

 

[Rico]

So lets hear some specific real reasons why Mesa is sooooo bad, and not little things on one specific flight.... thst happens at every airline.

Well the "rep" was initially established with the acquisition of all or part of carriers like Centennial, Aspen, West Air, Air Midwest, Allegheny, and Crown.

And in the recent past it was Mesa's pioneering of the "undercut", in which current and future flying was outsourced to your carrier, rather than the established carrier(in house or affiliate) with a better contract. (In the past Mesa would acquire the established carrier, now they do not even bother). Another thing that Mesa pioneered was the willingness to fly multiple contracts for competiting airline systems. Who knew if a given Mesa plane would fly with us one day, or for the competition the next...?

And nowadays it is the new development of your so called "regional" flying extending into 70 + 90 seat aircraft. Forcing some Mainline pilot groups to consider, or actually agree to F-28 and F-100 sized aircraft being flown at rates even lower than your own, just to keep that flying on the property, and not yours.

No, this is not off topic nor meant to be mean spirited, as it was Mesa's willingness to fly UAX for less than AWAC that led to this unique situation and surprising investment. Hope this answered your question why others might view your airline in a certain light.

 

[madders]

Yeah, this thing has that smell of UAL/U all over it. There has to be more going on than anyone on this board can know. Time will tell.

[post="249295"][/post]​

I remember during the proposed merger between ual/u when the flight attendants claus about ual owning other airlines ie (usairways wholly owns) an agreement was reached to sell the wholly owned to air wisconsin upon the merger

 

[North by Northwest]

The ATSB does not own any part of US.  The RSA is the largest stakeholder in US, I believe it was around 37%, ALPA owns 19% and the other unions own stock.

The Company has issued warrants for the ATSB to get, but to date the ATSB has not asked for or gotten any of the warrants, therefore they have no ownership and no stock.

And the ATSB is has no money invested in US, they only gauranted the loan, GOVCO is the primary lender and I believe the outstanding amount is around $650 Million of the secured portion.

So it is not the end of the ATSB, lights are still on and you lose.

[post="248927"][/post]​

 

[autofixer]

It seems as if UAL/U management has decided to take the incremental approach to their desired merger. If you cannot get it in one large swoop, do it over a long period of time and hope no-one notices.

If a merger made sense a few years ago, it certainly makes sense now.

 

[ClueByFour]

did air wisconsin just pick the survivor of a usairways/united merger?

why not invest in ual? hmmm.

[post="248937"][/post]​

Umm, largely because they can't afford a company the size of UA, whereas 1/4 of US can be had for a paltry $125 million.

The potential for Air Wisconsin to fly for US Airways Express gives US Airways a significant amount of leverage to lower affiliate carrier costs. US Airways has not yet affirmed any affiliate carrier contract and if necessary, can reject the contract in its bankruptcy case and replace the lost flying with Air Wisconsin service.

Yeah, but in that case, US will pay Air Whisky whatever Air Whisky says they will pay. It won't be a sweetheart deal. Sort of like maintenance in Alabama.

 

[Capecod]

Umm, largely because they can't afford a company the size of UA, whereas 1/4 of US can be had for a paltry $125 million.
Yeah, but in that case, US will pay Air Whisky whatever Air Whisky says they will pay. It won't be a sweetheart deal. Sort of like maintenance in Alabama.

[post="249415"][/post]​

That is one of the problems here. U will get some cash to help them last a few more months but if Air Whisky replaces all the U contract carriers U's RJ cost will go up significantly. This will not help U long term.

Also on that note, I would think the guys at PSA should be a bit worried to. I don't think U will merge the companys and if I was a PSA guy I would worry that Air Whisky has a good chance to take all the future growth.

Should be interesting. -Cape

 

[Capecod]

In 2003 US paid Mesa $232,000,000.

[post="249152"][/post]​

You say this daily. So what. The question is how much $ did the Mesa flights bring U? If it was 232,001,000, then it is a good deal for everyone. -Cape

 

[Capecod]

Why don't you post Mesa's on time performance compared to other contract carriers? Don't want customers to see the real picture?

[post="249457"][/post]​

Don't have the numbers but I will see if I can get them.

The facts are a large majority of the delays are because of PHL ATC and PHL ramp. I had a hour and a half ramp delay last week because they had 3 rampers working 4 gates. This isn't Mesa's fault but I am sure if you were flying on this airplane later in the day when it was running an hr behind you would be cursing at Mesa for it. That is just the life dealing with PDT ramp and U's desire to add so many flights in PHL. -Cape

 

[funguy2]

3. There are only so many spots at the US Airways table, and with AWAC coming to dinner, that means that we do not need all of the Affiliates that we have now. Thus you get them to compete with one another to secure the remaining flying, or you replace them outright. Again, they might just jump ship to UAL or DAL, but it is better to take AWAC's $$$ and use them instead than to just leave things the way they are now.

This is false. US Airways has always been willing to add more chairs to its ever-crowded table when it comes to getting what it wants from its regional operators. Just a few years ago, US Airways had no less than 12 individually certificated Express partners.

It is certainly plausible that US Airways could simply add Air Wisconsin to the list...

 

[Rico]

No, that used to be, but in case you have not noticed, the luster of 50 seat RJ's has worn away. There is a big difference between adding a few turboprops on a express code share agreement, and offering another fee for departure agreement to anyone.

There is a profitable niche for 50 seater RJ equipment, but it is limited in nature. Look at our competition trying to figure out what to do wtih their overstuffed fleets of small jets.

IMO the only way that US Airways could pressure the current RJ affiliates into lowering their fees is to have someone ready and able to replace them. This serves us as well as it serves AWAC.

Honestly, no one knows how this will play out, but the fact is that it has opened up numerous options for the future of US Airways Express.

 

[ManDachine]

Does anyone know if Air Wisconsin owns any gates at ORD or are they leased by United?