Originally Posted by gatorhater

No I don’t remember. However, you don’t ‘need cash’ to file bankruptcy. What you need is cash on hand to operate while going through the process. If that cash is not available the judge gets to sell your assets to create that cash and satisfy obligations to creditors. $400m is a lot of money for you and I, but not that much when it comes to operating expenses of the 3rd largest, at the time, airline in the world.

One of the largest, and easily moved assets was the lease on the C/D gates in ATL. Southwest and others had been trying to get into ATL for years. AirTran wanted to expand in ATL. The city was a creditor and could have easily gotten more $$ than ASA was paying for another airline to get their foot in the door. New or expanded airline would then be primed to make a direct run at Delta on their home turf. One way to guard against that was by protecting the C/D gates from the bankruptcy court.

By contrast very little of CVG traffic was by CVG locals. It was a connecting point (like MEM post merger) and therefore could be worked around and Delta would be just fine without it. They used ComAir as a place to hide losses, just like Inc. used ASA.



If they needed cash they would also have sold ComAir for $400m but it was frequently mentioned Delta’s ask was $1b for the exact same thing as ASA. The airlines were roughly the same size and composition, the major difference was the ATL gates.