Originally Posted by
FlyASA
Not only does the company have a bad reputation but the second they enter BK Delta will for sure dump them (US could possibly dump them too). With out significant feeder contracts no one will see them as viable. I'm not sure they could even get capital to finance an exit chapter 11. The credit market is still very tight and Mesa has had a lot of negative press recently (Delta court battle, Aloha, etc.), I'm just not sure JO could sell the prospect of his company to anyone.
In the current regional feed and credit markets, a ch.11 filing could be catastrophic, and lead very rapidly to ch.7.
OJ's only chance would be to re-negotiate one of his feeds in advance (UA or US), downsize the company by 70% to match the new contract, and attract some financing for his rationalized operation..
Since a BK filing would almost certainly allow all major partners to dump mesa immediately, he would lose DL for sure, probably one other, and quite possibly all three. It would be too tempting an opportunity for the majors to dump excess capacity without expensive lawsuits.
I'm guessing he might be able to keep one, because BK might allow him to reduce lease and labor contracts and make a really lowball offer to somebody (MAG pilots, say buh-bye to your recent contract "gains")
I think it will all hinge on the 900's...they are the only thing of value he controls, and they might serve as the basis for a new ultra-cheap, large RJ contract (I'm sure UA-ALPA will roll over on the scope if offered some enticement). But it's a dangerous game...since 900's have street value, if he cuts too close to the bone on those leases the lien-holders might just take their toys and go home.