Airlines Solicit Court For Extensions

In a possible setback for its goal to emerge from Chapter 11 bankruptcy by the end of summer, Delta Air Lines asked the US Bankruptcy Court on Monday for more time to solicit acceptance for its reorganization plan.

The Associated Press reports it is the fourth time Delta has asked for such an extension, and the first since Delta revealed its reorg plan in December. The current plan gives Delta until April 16 to garner approval; after that, other entities -- including Delta's creditors -- may file their own proposals to return Delta to profitability.

The Atlanta-based carrier is asking for that deadline to be moved to June 1. Delta argued the extension is warranted, as a confirmation hearing on the plan is scheduled for April 25, nine days past the current deadline.

"The enormous size and vast complexity of these Chapter 11 cases mean that voting on and seeking conformation of the plan of reorganization will take time," Delta stated in its court motion, which is now being reviewed.

The carrier denied the extension request is a negotiating tactic, adding the request has the support of the official committee of the airline's unsecured creditors.

For the moment, there is no indication any other entities plan to file competing reorganization plans.

Delta isn't the only carrier asking for more time to sway its creditors to see its side of things. Similarly troubled Northwest Airlines -- which filed for Chapter 11 the same day as Delta -- also asked for an extension Monday to the period during which it may exclusively propose a reorganization plan. Northwest will need an answer soon... as its deadline is due to expire March 16.

Northwest is asking for that date to be extended to June 29... one day before the end of the second fiscal quarter. Northwest has stated it intends to exit bankruptcy in the second quarter.

That's gonna be close...

FMI: www.delta.com, www.nwa.com