danielsexton
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Delta\'s restructuring effortsl
From the AP
[ QUOTE ]
Delta fails in effort to repurchase airplane-backed debt
Associated Press
NEW YORK - Shares of Delta Air Lines Inc. slipped Friday after the company said it failed in its effort to remove limitations on certain debt, which would have allowed the company to buy back that debt as part of its restructuring efforts.
The failure of the consent solicitation was expected by both equity and debt analysts but makes Delta's restructuring efforts more difficult and likely lengthier.
The airline was seeking the approval of the holders of some debt certificates to remove restrictions on its ability to buy or hold the securities. The debt is backed by physical assets, such as airplanes.
In August, the Atlanta-based company said such approval would give it additional flexibility to keep its financial restructuring out of court, and warned that failure to get the approval would "seriously limit" its ability to include that debt in future restructuring steps.
Shortly after the solicitation was made, however, a group of 34 financial institutions told the company that it wouldn't support it, because it was troubled by the airline's response to the panel's request for information.
Philip Baggaley, managing director at Standard & Poor's, said the failure of the consent solicitation makes Delta's restructuring efforts more difficult.
"I don't think it derails what Delta is trying to do but it shows that it may be longer and more difficult than they had initially hoped," he said.
Baggaley expects that Delta will have to provide debt holders with more information, including details of its entire debt restructuring proposal, before bondholders are willing to remove the buyback restrictions.
Delta's shares were down 10 cents at $3.82 in late afternoon trading on the New York Stock Exchange.
[/ QUOTE ]
From the AP
[ QUOTE ]
Delta fails in effort to repurchase airplane-backed debt
Associated Press
NEW YORK - Shares of Delta Air Lines Inc. slipped Friday after the company said it failed in its effort to remove limitations on certain debt, which would have allowed the company to buy back that debt as part of its restructuring efforts.
The failure of the consent solicitation was expected by both equity and debt analysts but makes Delta's restructuring efforts more difficult and likely lengthier.
The airline was seeking the approval of the holders of some debt certificates to remove restrictions on its ability to buy or hold the securities. The debt is backed by physical assets, such as airplanes.
In August, the Atlanta-based company said such approval would give it additional flexibility to keep its financial restructuring out of court, and warned that failure to get the approval would "seriously limit" its ability to include that debt in future restructuring steps.
Shortly after the solicitation was made, however, a group of 34 financial institutions told the company that it wouldn't support it, because it was troubled by the airline's response to the panel's request for information.
Philip Baggaley, managing director at Standard & Poor's, said the failure of the consent solicitation makes Delta's restructuring efforts more difficult.
"I don't think it derails what Delta is trying to do but it shows that it may be longer and more difficult than they had initially hoped," he said.
Baggaley expects that Delta will have to provide debt holders with more information, including details of its entire debt restructuring proposal, before bondholders are willing to remove the buyback restrictions.
Delta's shares were down 10 cents at $3.82 in late afternoon trading on the New York Stock Exchange.
[/ QUOTE ]
AL - News) on Friday said a group of bond holders refused to change the terms of their securities, adding to the headwinds the airline faces as it struggles to avoid bankruptcy."
