Will Dr. Bronner And His Alabama Retirements Fund.

[pitguy]

As we all know Dr. Bronner runs the Alabama Retirement fund and they have invested in Airways. Will their stock and investment be dumped in bankruptcy court like other stock and investments were last time? I don’t see how it would not be the most prudent and fiduciary route for the company not to do it to them while they are in bankruptcy court.

 

[Smartest Loser]

I can almost bet...

Dr. Bonner and his money men are gonna get something out of this. Its like a scary movie, the bad guy always has a exit plan to get away. Then shows back up somewhere in the movie...!!

SL

 

[pitguy]

I agree even though it just does not seem right for Airways not to maximize their trip through Ch-11 by dumping the stock.

 

[BoeingBoy]

As it stands today, one has to remember that RSA has three roles - investor, lender, and leasor.

As an investor, they paid $240 million for stock. As it stands now, that stock will be cancelled when we emerge from BK and RSA's holdings will become worthless - like every other US stockholder.

As a lender, RSA provided 75% of the "Tranche B" portion of the $1 billion ATSB-backed loan. The Tranche B part is not guaranteed by the ATSB nor is it secured. Thus, RSA is an unsecured creditor and will share in the 12% of "new" stock that is to be issued to the unsecured creditors when we emerge from BK.

The aircraft we currently lease from them will presumably still be leased from them after emergence from BK, though all the aircraft that are to be returned haven't been identified yet.

Jim

 

[pitguy]

Jim,
Thank you for the reply.



P.S.- He is almost reserves huh? 🙂

 

[BoeingBoy]

Getting close....

Jim

 

[LGA / 037]

FLY JUN 6 2005 7:02

USAirways Group - UAIRQ Fridays run up offers selling oppty-underweight@PRUS

The firm calls the strenth on Friday as misguided optimism by uninformed investors noting these shares are still likely to be cancelled once the company emerges from bankruptsy. PRUS feels the shares could be an attractive short at these levels.



Bronner IS a secured creditor but will probally have to write off his investment for now. Once he see's the oppourtunity to be the controlling investor then he might make a move. He could go elsewhere maybe with UAL and then return later if UAIR/HP hook up with UAL.

 

[28yrsnojob]

bonner cost be 36000.00 in sick time and 2500.00 shares of stock the
first bk .as far as i am concerned his stock should be worthless

 

[BoeingBoy]

Bronner IS a secured creditor but will probally have to write off his investment for now.

[post="275882"][/post]​

I could have sworn that RSA's loan (75% of the Tranche B protion of the ATSB loan) was unsecured, but could definitely be wrong.

Media reports indicate that RSA has already written off the $240 million in investment.

Jim

 

[700UW]

From the Bankruptcy I press release:

US Airways also closed on exit facilities that provide the company with $1.24 billion in liquidity, including a $240 million equity investment from the Retirement Systems of Alabama Holdings LLC (RSA), and a $1 billion loan - $900 million of which is guaranteed by the Air Transportation Stabilization Board (ATSB). The remaining $100 million of at risk funds are provided by RSA ($75 million) and Bank of America N.A. ($25 million). All funds were received today. The company repaid RSA $372 million owed on the debtor-in-possession facility, and also paid RSA $9.4 million of administrative rent, and paid structuring, loan syndication, collateral agent, loan administration and professional fees and expenses totaling approximately $48 million.

20 Largest Unsecured Claims

RSA is not listed there.

 

[BoeingBoy]

700UW & LGA/037,

You are both absolutely correct and I was wrong. The Tranche B loan is secured by the same collateral as the Tranche A ATSB-guaranteed loan.

Apologies to all...

😳

Jim

 

[700UW]

Jim,

Nothing to be sorry about, it is confusing and I had to read a 44 page loan agreement to get some more details that I did not post.

And we all know you did not post anything false on purpose, unlike another poster, so don't apologize for posting something that was not correct.

 

[usfliboi]

The company confirmed already that it is still in talks with RSA! See the questions answer segment from the company!

 

[700UW]

The company confirmed already that it is still in talks with RSA! See the questions answer segment from the company!

[post="275997"][/post]​

Oh really?

RSA Won't Invest in Airline Merger for Now
By Phillip Rawls, Associated Press Writer
Ala. Pension Fund Plans No More Investment, for Now, in Proposed US Airways-America West Merger

MONTGOMERY, Ala. (AP) -- The Retirement Systems of Alabama, which wrote off a $240 million investment in US Airways last year, plans no more investment -- for now -- in a proposed merger of the bankrupt airline with America West.

David Bronner, CEO of the state pension system, said RSA was asked to invest in the proposed merger, but he declined because RSA would not be given a big enough role in directing the new company.

"They just want your money and don't want you to have any control," Bronner said in an interview Friday with The Associated Press.

Full Story

 

[FWAAA]

700UW & LGA/037,

You are both absolutely correct and I was wrong. The Tranche B loan is secured by the same collateral as the Tranche A ATSB-guaranteed loan.

[post="275972"][/post]​

This a classic situation of "everyone's sorta right." 🙂

In strict legal terms, RSA is secured.

But in real-life "would it get any money in a liquidation" terms, RSA is probably not really secured, since its security is a subordinate position in the same collateral as secures the ATSB. ATSB would get its dough first, and anything left over would go to RSA. Still, some security is better than nothin' in cases like this.