mikea72580

It entirely depends on the terms of the new loan. Particularly the interest rate. If the rate they secured was meaningfully higher that the rate being offered by the government, then they have opened themselves up to a world of scrutiny. Personally, I'm guessing the rate was about the same.

FangsF15

If congress can't get anything done (standard), POTUS has said he will take executive action for the airlines. His options are limited, obviously. What if his plan is to permanently defer loan repayment for the second part of CARES 1 money already appropriated? We'd be screwed.

At a minimum, I'd wager he will waive repayment of the 30% portion of the first part/grant.

Drum

He's got about $300B left in discretionary appropriation which is a proper color of money he can shift around without congress' approval.

Seneca Pilot

Not sure without some research but as this involves the national airspace system and is considered part of the national security apparatus there are probably some moves he could make with respect to emergency declarations that would free up some money earmarked for other things.

FangsF15

You are giving me PPB&E flashbacks. 3400 money? Broken Glass? AAAAAAARRGHHHHH!!!

Drum

Thirsty for more?

The 5 sided puzzle palace was the worse 3.5 years of my mediocre career. I did learn a lot while there though about the "budget".

My guess is 3600 money as it has an egg timer on it before it goes "poof" at the end of this FY + 6 months. I can't find it though and really don't want to dig into the budget right now.

I've got to clean the "UNA dust" off the Ipad and start to figure out what an aero-plane is again. How do you start this thing?

notEnuf

tomorrow

direct link... https://morganstanley.webcasts.com/s...key=c5fd62214a

notEnuf

Accolades for the $9B financing deal with skymiles. Respected in the credit market for a decade of balance sheet discipline. Bridge loan and other maturing debt has been refinanced at a reasonable market rate ~4.75%. First priority is to rebuild network then pay down debt. Fleet simplification capex could be reduced from 10 to 5 years while reducing types and cost which accelerates profitability. Facilities investments allow availability as the network is grown LGA financing is completed. Public financing is the goal given the flexibility and collateral value.

Scoop

I agree 100% with 1 and 3 but am very much against 2. Dividends are a far cry from Stock buybacks and Management pumping up bonuses etc.

I can possibly see some limitations on dividends but to treat them exactly the same as buybacks IMHO is a mistake. Then again if the govt. makes the deal so onerous all the airlines that have the capability will pursue funding elsewhere.

Scoop

Big E 757

The last one was the deal breaker, I’m sure. Remember the 2007-2008 housing/banking crisis. AIG, after receiving BILLIONS in government aid to avoid a collapse in the insurance sector, was caught giving multi million dollar bonuses to the executives, with government money. Their excuse was that the bonuses were part of their expected compensation. If you start limiting or eliminating executive bonuses, things get “real”.

I think Ed and some other executives stopped drawing their salary until things get better, but I think 80+% of their compensation is stock, options, and performance based pay, so right now, my guess is, they’re still receiving stock or stock options (at an extreme discount compared to 2019 stock prices) and when things recover, they’re going to be swimming in very lucrative stock and/or options positions in DAL.