Current Market cap of LCC < 1B$
Unions secure three seats on creditors committee
- Thread starter High Speed Steel
- Start date
- Aug 20, 2002
- 7,319
- 1,555
Could you explain what the Market Caps have to do with this scenario? When you answered LCC < 1B$, how does that play into a merger between the two airlines?
BoeingBoy
Veteran
- Nov 9, 2003
- 16,512
- 5,865
- Banned
- #18
No more than any other unsecured creditor. The unionized employees, represented by their unions, will in all likelihood be among the biggest unsecured creditors and deserve a seat at the table as much as any other unsecured creditor.
As FWAAA said, never in an airline bankruptcy. The shareholders, being the owners, are last in line to recover anything.
The stock of US has very limited value as consideration in a merger, and thus, a merger would probably require billions in cash (since the stock is not worth billions). That cash would likely have to be borrowed. If the US stock does not appreciate between now and then, US could issue 100 times the current number of shares, give them all to the new AA shareholders (or the creditors if prior to the new share issuance) and that huge mountain of shares would be worth, at today's value, less than a billion dollars.
- Aug 20, 2002
- 7,319
- 1,555
Isn't borrowing what got us in the predicament we are in now?
No spending, look around you and you can probably see how the company has been pissing money away. Their revenue increased by $6 billion while the airline shrunk by a third. Thats a windfall, however management was able to piss it away. Each manager was given a budget and told spend it or lose it. It was like a scene from Brewsters Millions. At LGA they bought a useless conveyor system that was later carted away, the manager had gone to the workers and asked for ideas on how to spend, when they gave her no input working refridgerators, microwaves, computers and TVs were replaced in order to burn through the cash, sure FWAA will say thats small change but add this up in scores of locations across the system and we are no longer talking small change. So between fuel and wasteful expenditures AA was able to show a loss. By timimg the payments to the pension they are able to craft charts claiming they have the highest benefit costs(even though in the prior year they had one of the lowest).
During this process we will be barraged with propaganda. Cooler heads must prevail and we must prepare to act, regardless of injunctions, to protect our interests. The fact is that AA has plenty of money, they not only have $4 billion in cash but they bring in even more than that on a bad quarter. They could not get what they wanted in negotiations and the NMB was running out of excuses to not release the parties to self help so they duck into a friendlier arena, however they are not broke. The Judge should say that their application has no merit and throw it out. If companies with plenty of revenue and plenty of cash can go into C-11 to get favorable deals imposed on workers then Unions have no reason to exist, there is no such thing as a level playing field on which to conduct collective bargaining, and I think thats their objective. The question is will the leaders of Unions see it that way and act?
By the way, some have said that Unions cant strike if their contract is abrogated, the RLA says the exact opposite, thats also not exactly what the appelate court ruled, they ruled that the Injunction was legal and that Unions had to go through the process under the RLA before they could strike, well if the Union showed it had gone through the process then there really should not be anything from stopping them from striking. Remember at first the Judge said they could resort to self help, then a different Judge issued an Injunction, then the union challenged the injunction and lost.
Still trying to find the new floors at BOS & LGA that you keep mentioning. I was at Logan Sunday and it was the same floor that had been there since circa-2006.
Josh
Maybe after you find your feet you can find the floor.
You obviously did not go downstairs to collect your bags in BOS or come in the wing that AA has used since the terminal was built. Nice new chairs at LGA as well, with outlets for your PEDs as well! More neccissary expenditures!
I saw the new chairs at LGA with the power outlets (even posted about them and agreed it's wasteful) but don't understand your frustration about the floors. The old chairs were fairly new and since few flights from LGA exceed 4 hours in duration little reason for the outlets. Wouldn't Massport/PANYNJ be responsible at BOS/LGA, respectively for the flooring?
Josh
Bob disagrees (big surprise) but yes, excessive debt is a big problem. Parker's wet dream of buying AA while in bankruptcy will require that he find billions of dollars of borrowed money to pay the creditors, since the US stock is worth too little to serve as the currency. And a combined US-AA with an extra several billion of debt would be a disaster. AA's creditors and Parker's potential lenders all know that, minimizing the odds that Parker is able to get AA while in bankruptcy. But I could be wrong.
The extent of your denial is stunning. My prediction is that you and other AA employees who believe that AA's financial problems are manufactured solely to screw workers will soon experience shock and awe at what Horton will ask for and get. It will be "take these concessions or I'll abrogate your contract" and that's what will happen.
Will the rest of us be spared?
Mr Red
Veteran
- May 11, 2010
- 612
- 182
Get the facts straight !wealth transfer from employees to OIL CARTELS !!!!!!!!!BOTTOM LINE
MCI transplant
Veteran
- Jun 4, 2003
- 5,311
- 584
- Banned
- #30
<_< ------- No high speed! What I think he's alluding to is that the TWU hasn't represented the ramp, and mechanics, "best interests" in quit a while!!!
