ATSB rejects UAL $1.8 bln guarantee

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chipmunn

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ual06

Senior
Aug 30, 2002
331
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NEW YORK, Dec 4 (Reuters) - A federal board's denial of
United Airlines' application for $1.8 billion in loan
guarantees is not final, because the airline is still allowed
to submit changes to its business plan and ask for
reconsideration, a federal official said on Wednesday.

If United chooses to file for Chapter 11 bankruptcy
protection, the Air Transportation Stabilization Board would
also consider giving the airline exit financing upon its
emergence, Daniel Montgomery, executive director of the board,
said in a conference call with reporters.

"The action today is not a final denial of the board," he
said. "It would be open for United airlines to request that the
board consider a new business plan, whether developed under
court supervision or otherwise."
But Montgomery said the federal board members had
considered all proposed cuts by United's labor unions in its
assessment of the company's business plan, including a $700
million package by mechanics up for vote on Thursday.

After a meeting several hours long, the board denied the
application from United, a unit of UAL Corp. (NYSE:UAL), in part
because its revenue projections did not match up with its high
cost structure, Montgomery said.
 

ual06

Senior
Aug 30, 2002
331
0
NEW YORK, Dec 4 (Reuters) - A federal board's denial of
United Airlines' application for $1.8 billion in loan
guarantees is not final, because the airline is still allowed
to submit changes to its business plan and ask for
reconsideration, a federal official said on Wednesday.

If United chooses to file for Chapter 11 bankruptcy
protection, the Air Transportation Stabilization Board would
also consider giving the airline exit financing upon its
emergence, Daniel Montgomery, executive director of the board,
said in a conference call with reporters.

"The action today is not a final denial of the board," he
said. "It would be open for United airlines to request that the
board consider a new business plan, whether developed under
court supervision or otherwise."
But Montgomery said the federal board members had
considered all proposed cuts by United's labor unions in its
assessment of the company's business plan, including a $700
million package by mechanics up for vote on Thursday.

After a meeting several hours long, the board denied the
application from United, a unit of UAL Corp. (NYSE:UAL), in part
because its revenue projections did not match up with its high
cost structure, Montgomery said.
 
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