WorldTraveler
Corn Field
- Joined
- Dec 5, 2003
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Delta: Large Visa/mc Holdback Required
- Thread starter WorldTraveler
- Start date
Vikedog64 said:
DL is short of cash and burning cash (burned cash even in the most profitable quarter -- Q2). A new credit card processor will require a large cash secuirty deposit to start processing transactions for DL. That puts a further big hole in their unrestricted cash levels, and DL still has significant pension and other cash obligations in Q3 and Q4. Plus, cash burn starts increasing now as new bookings fall off.
Summary -- it's bad news. They either need to (1) raise some cash somehow (don't see any offers for ASA or Comair yet, or GE stumping up more cash) (2) get the processor to reduce their cash demands (maybe possible -- but how much will they concede?) or (3) simply not allow Visa/MC for payment. I assume a very large % of DL bookings are made via Visa or MC (50% plus??).
Unless DL pull another rabbit out of the hat very very soon, they'll have to file Ch11
