Originally Posted by
Lucifer
Debt matters not; so long as revenue exceeds the servicing of the debt..... Still, even then, creditors will often revise and restructure the debt rather than face getting pennies on the dollar in bankruptcy. I'd expect them to use the COVID crisis as cover to renegotiate first; then a bankruptcy if that fails. Their BOD will be satisfied that it wasn't their fault, it was COVID's, and they made every reasonable effort to save the company prior to Ch.11
In the end however, all debts must be paid.
I’m no financial wizard; but according to public data AAL has over $67B in total liabilities, and assets are about $60B. I imagine you can’t just look at the $42B in debt, but also need to consider total liabilities, that’s well over 110% leveraged. Or, am I missing something?