AMR Wants Time To Develop Restructuring Plan
Published: June 30, 2012
AMR, the parent of American Airlines, wants more time to file a reorganisation plan in bankruptcy without potential interference from outside parties.
American, which sought court protection in November, and its unsecured creditors jointly asked a New York bankruptcy court on Friday to extend the airline’s so-called exclusivity period by three months to December 27, the airline said.
“We have one chance to get this restructuring right, so it’s important we approach this process in a methodical and disciplined manner. More time does not mean we will slow down,” said an American spokeswoman.
If approved, extended exclusivity would hold off any merger bid by US Airways.
US Airways has expressed interest in a deal to combine networks and better compete with United Airlines and Delta Air Lines. Both of those airlines have gotten stronger through mergers.
American’s unions, members of the unsecured creditors committee, have pressured the company to seek a deal with US Airways.
US Airways had no comment on American’s bid for extra time to formulate a plan.
American has said it would weigh all options, including consolidation.
American reached a tentative contract agreement with pilots this week aimed at cutting costs and prospects brightened that other unions may soon follow suit.
New contracts would give American the certainty it seeks about labour costs, which it wants to cut by more than USD$ 1.2 billion annually.
Labour deals would also be a milestone in American’s restructuring and address a central concern of bondholders and other key parties that have a stake in the outcome of bankruptcy.