Delta takes another step toward bankruptcy

[icymist]

Saturday, May 29, 2004

Delta takes another step toward bankruptcy

SEATTLE POST-INTELLIGENCER STAFF AND NEWS SERVICES

Delta Air Lines Inc. seemed another step closer to its threat of bankruptcy yesterday as the company hired investment bank Blackstone Group, while bondholders and vendors allied themselves in preparation for a possible Chapter 11 filing by the airline.

Delta, the third-largest U.S. airline, is working with Blackstone among other advisers to help "with all aspects of our business reassessment and planning efforts," said spokeswoman Peggy Estes.

<snip>

The Atlanta-based carrier is an important Boeing Co. customer and still has a number of Boeing jets on order. Since the Sept. 11, 2001, terrorist attacks, Delta has worked with Boeing to defer some of those orders until later. But a bankruptcy filing could result in cancellations.

<snip>

Delta said May 10 that it may be forced to seek bankruptcy protection if it can't reduce costs, stem losses and raise capital. The company asked pilots, its only unionized work group, to take a 30 percent pay cut to help reduce labor costs. Delta had $3.26 billion in losses the past three years.

More at this

[RC]

1. I wonder what kind of cuts management is considering for itself?

Or are they packing their golden parachutes?