Carrier Hopes To Renegotiate With Airbus

US Airways Group Inc. says it has missed payments due Thursday on $19.7 million in public debt related to five Airbus A330 aircraft and has started talks with creditors to make new payment arrangements.

The airline, based in Arlington (VA), expects to reach an agreement on the payments during a 10-business-day window allowed for under the payment plan. A spokesman would not say who holds the debt.

Talks With Investors

US Airways also says it is talking to its lead investor, Retirement Systems of Alabama, about drawing a final $200 million out of money RSA made available when it offered debtor-in-possession financing to the airline, which filed for Chapter 11 protection from creditors in U.S. Bankruptcy Court in August.

US Airways says recent discussions centered on a requirement that it demonstrate to "the reasonable satisfaction of RSA" that it is likely to satisfy all the conditions for issuance of the Air Transportation Stabilization Board's $1 billion loan guarantee.

Hoping For The End Of March. But There Are Still Obstacles...

US Airways, the seventh largest U.S. air carrier, hopes to emerge from bankruptcy at the end of March. On Jan. 17 a federal judge permitted US Airways to present its reorganization plan to its creditors for consideration.

However, the plan could still be changed to accommodate any concerns raised by the court or its creditors -- who must decide whether to accept the proposal.

US Airways is scheduled to seek final court approval of its bankruptcy reorganization plan at a hearing set to begin March 18. Its five wide-body Airbus A330 planes are part of its mainline fleet.

FMI: www.usairways.com