Originally Posted by FriendlyPilot

BK doesn't "ditch debt". It allows reorganization of debt, which is mostly ordering of debt priority. But courts don't just wipe out debt to the detriment of creditors and just hand over those assets free and clear to companies. Spirit has been in BK twice now and except for some leases that were terminated there was little change in the total debt picture. In reality there is more non-lease debt now because of 2 rounds of DIP financing which was more than any debt converted to equity.

Also any 363 sale would have to have the cerditors agree to those, so they can't just buy a plane or some other asset for $1 and get it free and clear. There would have to be over 50% to require the purchaser to bring over employees, but if its over 50% they have to bring them ALL over if they are unionized. So this is actually a barrier for companies.

That's the ultimate problem here. If you want to buy Spirit, you have to choose between the entire airline, which includes all the debt, or just a few pieces.