US Airways seeks to double share authorization
- Thread starter USA320Pilot
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hp_fa
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- Feb 19, 2004
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Bonuses or other compensation would be my guess, including one Douglas Parker.
The company doesn't pay cash for bonuses and would supposedly tie the employee's production to the value of the stock, which could be a windfall for someone given stock and the price were to increase compared to the value of the stock when awarded.
So the annual meeting was moved to make Seymour Licht travel to New York?
flybynite
Veteran
The obvious answer is in the article you linked:
US may need to issue more convertible debt and it cannot do so unless it has the shareholder authority to issue those new shares. Since increasing the number of authorized shares requires shareholder approval, it is best done at an annual meeting.
ClueByFour
Veteran
Because financing has dried up and this is what is left to keep the lights on thru cash burn.
Not likely in this case. If approved, the additional shares would represent approximatley 50% ownership in the corporation. But I do think their purpose here is for future financing (convertible bonds etc.) and future ownership change/issues that are becoming more and more inevitable. Me thinks they have some plans.....BIG ONES
- Thread Starter
- #10
US Airways seeks to double issued shares
NEW YORK (MarketWatch) -- US Airways proposed to double the number of shares it's authorized to issue to ensure available capital for any unforeseen purposes. In a filing late Tuesday, the Tempe, Ariz.-based carrier said it would sell the new shares at its discretion to raise additional capital, pay dividends, make acquisitions, settle outstanding obligations, provide equity incentives to employees, and other general purposes. The proposal would raise the number shares US Airways can issue to 400,000 from 200,000. Shares of US Airways were down a fraction in premarket trading to $2.87.
Click here to read the entire article
USA320Pilot comments: In my opinion, the two major reasons US Airways' Board wants to issue 200,000 more shares is to reaise additional capital in case the economy worsens or there is a shock event (such as uncontrollable energy costs) or to fund a strategic corporate transaction (SCT). If I had to guess US Airways may make its third attempt to acquire United, but that is strictly a guess based on history and recent public comments made by US Airways president Scott Kirby.
Separately, a merger with United would likely end US Airways' East vs. West pilot dispute because the NMB would order a representational election between USAPA and ALPA. In my opinion, the West pilots would work together with the United pilots to elect ALPA as the combined pilot groups collective bargaining agent, which would eliminate USAPA.
Regards,
USA320Pilot
NEW YORK (MarketWatch) -- US Airways proposed to double the number of shares it's authorized to issue to ensure available capital for any unforeseen purposes. In a filing late Tuesday, the Tempe, Ariz.-based carrier said it would sell the new shares at its discretion to raise additional capital, pay dividends, make acquisitions, settle outstanding obligations, provide equity incentives to employees, and other general purposes. The proposal would raise the number shares US Airways can issue to 400,000 from 200,000. Shares of US Airways were down a fraction in premarket trading to $2.87.
Click here to read the entire article
USA320Pilot comments: In my opinion, the two major reasons US Airways' Board wants to issue 200,000 more shares is to reaise additional capital in case the economy worsens or there is a shock event (such as uncontrollable energy costs) or to fund a strategic corporate transaction (SCT). If I had to guess US Airways may make its third attempt to acquire United, but that is strictly a guess based on history and recent public comments made by US Airways president Scott Kirby.
Separately, a merger with United would likely end US Airways' East vs. West pilot dispute because the NMB would order a representational election between USAPA and ALPA. In my opinion, the West pilots would work together with the United pilots to elect ALPA as the combined pilot groups collective bargaining agent, which would eliminate USAPA.
Regards,
USA320Pilot
Strategic Corporate Transaction? Acquire United? Give it a rest.
USAir's current market cap is all of $300 million. Acquire another airline with stock? Not likely. If US sold all 200,000,000 new shares today at the current price, it would raise just over half a billion dollars. Just enough to pay for the likely increase in fuel costs this year (over what everyone thought late last year they'd cost this year).
USAir's current market cap is all of $300 million. Acquire another airline with stock? Not likely. If US sold all 200,000,000 new shares today at the current price, it would raise just over half a billion dollars. Just enough to pay for the likely increase in fuel costs this year (over what everyone thought late last year they'd cost this year).
I plead ignorance when it comes to stock and owner's equity issues, but let's assume for a minute shareholders approve this. First of all, it will have no real affect on anything until Tempe actually "issues" the stock for purchase. At this point it is only authority to issue an additional 200 million shares. Secondly, at today's market price of about $3 give or take, if all 200 million shares were offered for purchase at once; this would yield only around $600 million. This is hardly enough to purchase UA or a fleet of new Airbuses. Any thoughts?
ALPO NO MO
Member
- Nov 12, 2007
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Dog Wonder
Veteran
We need to get all these "CT"s done at one time instead of spreading them out over the years,
ACT-Awesome Corporate Transaction
ICT-Inevitable Corporate Transaction
DICT-Definitely Idiotic Corporate Transaction
WACT-Wholly Abysmal Corporate Transaction
CRICT-Completely Ridiculous Imaginary Corporate Transaction
FUCT-Financially Untenable Corporate Transaction
JACT-Just Another Corporate Transaction
HACT-Half-Assed Corporate Transaction
RACT-Really Awful Corporate Transaction
ACT-Awesome Corporate Transaction
ICT-Inevitable Corporate Transaction
DICT-Definitely Idiotic Corporate Transaction
WACT-Wholly Abysmal Corporate Transaction
CRICT-Completely Ridiculous Imaginary Corporate Transaction
FUCT-Financially Untenable Corporate Transaction
JACT-Just Another Corporate Transaction
HACT-Half-Assed Corporate Transaction
RACT-Really Awful Corporate Transaction
