Sat, Jan 22, 2011
Airline Set To Emerge from Chapter 11
The U.S. Bankruptcy Court for the Southern District of New York
has approved Mesa Air Group’s Plan of Reorganization,
clearing the way for the airline’s emergence from Chapter
11.
“This is an exciting day for everyone at Mesa,” said
Jonathan Ornstein, Mesa’s Chairman and Chief Executive
Officer, announcing the approval Thursday. “Achieving a
turnaround of this magnitude in little more than 12 months would
not have been possible without the hard work and dedication of
Mesa’s employees and the focused execution of Mesa’s
Plan of Reorganization by our management team led by Michael Lotz,
President and Chief Financial Officer and Brian Gillman, the
Company’s Executive Vice President and General Counsel.
I’d also like to thank Paul Foley, our Chief Operating
Officer, David Butler, our Senior VP of Human Resources and Gary
Appling, our Senior VP of Maintenance & Engineering for their
efforts on our underlying business during the restructuring.
Following a 12-month restructuring, Mesa says it is set to
emerge as a leading regional air carrier flying primarily larger
70- and 86-seat regional jet aircraft. Mesa’s creditors
overwhelmingly supported the Plan of Reorganization, which also
applies to the eleven wholly owned subsidiaries of Mesa that filed
for Chapter 11 protection. Mesa and each of its subsidiaries are
expected to emerge from Chapter 11 in February 2011.
As part of the restructuring plan, Mesa will extended the term
of is code-share agreement with US Airways, Inc. through September
2015, and has eliminated over 100 unnecessary aircraft leases and
financings that contributed to the deleveraging of Mesa’s
balance sheet in the approximate amount of $700 million in
capitalized leases and $50 million in debt. Restructured aircraft
leases and financings for Mesa’s fleet of CRJ 200 and Dash 8
aircraft resulting in flexibility and no long-term lease exposure
on the CRJ 200 50-seat regional jet aircraft, and Mesa will emerge
as a private company and issue new notes, common stock, and
warrants to its creditors.
“Mesa is now poised to enter its next chapter as a strong
airline ready to compete in an ever changing industry. We are
particularly proud of the fact that during our restructuring, Mesa
achieved – and has consistently maintained – regional
airline leading operational performance as reported by the U.S.
Dept. of Transportation, including Mesa achieving the highest
monthly On Time Performance of all regional airlines since May
2010. This strong operational performance is a tribute to the hard
work and dedication of all of our employees and came during a time
when many of our employees contributed to our financial savings
through the taking of additional unpaid days off. This level of
dedication and associated strong operational performance has
provided a strong foundation upon which to return our airline to
sustained profitability and future growth,” Ornstein
said.
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