Mesa Air Group Chapter 11 Info
01-07-2010 | 09:19 AM
#11
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DashDriverYV,
It's really all in the hands of the bankruptcy court now. There was a bankruptcy clause in the Mesa/Delta contract but the specifics are unknown. Mesa claims $70 million in damages from Delta and Delta believes they can simply make Mesa go away, so it's anywhere in between.
The Chapter 11 rules do speed up the judicial process. The judge and creditor committee will push for a settlement and the Delta and Mesa managements don't have much say in the matter any more. Remember the committee is made up of the biggest creditors. Many of them would like to see Delta pay up as well because this may be the only way they'll ever see their money. Delta may be forced to settle either in the form of cash or a continuation of the contract. There are now deadlines in place to the process that all parties will have to adhere to. The ball is rolling.
Stay tuned...
winglet
It's really all in the hands of the bankruptcy court now. There was a bankruptcy clause in the Mesa/Delta contract but the specifics are unknown. Mesa claims $70 million in damages from Delta and Delta believes they can simply make Mesa go away, so it's anywhere in between.
The Chapter 11 rules do speed up the judicial process. The judge and creditor committee will push for a settlement and the Delta and Mesa managements don't have much say in the matter any more. Remember the committee is made up of the biggest creditors. Many of them would like to see Delta pay up as well because this may be the only way they'll ever see their money. Delta may be forced to settle either in the form of cash or a continuation of the contract. There are now deadlines in place to the process that all parties will have to adhere to. The ball is rolling.
Stay tuned...
winglet
It may play out with Delta being dinged for a settlement, Mesa emerges from BK, then delta terminates the flying.
01-07-2010 | 09:26 AM
#12
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From: ERJ 170
The timing of all this seems strange. Would it not be prudent to find out the results of the Delta lawsuit first before going bankrupt? This is why I think they have come to an agreement already. Only time will tell.
01-07-2010 | 09:56 AM
#13
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If there was an agreement with Delta then Mesa would have to had divulged that information during it's bankruptcy affadavit.
Mesa has three lawsuits against Delta:
1. ERJ Contract Termination against which Mesa so far has been awarded an injunction
2. CRJ-900 Contract Termination
3. Seven GE engines that Mesa claims.
Delta has one lawsuit against Mesa for material breach. No trial dates have been set.
During Chapter 11 proceedings everything is effectively frozen as-is. The Debtor(Mesa) has four months to come up with a plan. If the plan isn't approved by the court (with extesions) then Creditors (Wells Fargo, Bombardier, Embraer, GE, etc.) can enter their plan. The bankruptcy court will either approve a plan or not. Delta will have to wait along with the rest of us and see what the plan is.
winglet
01-07-2010 | 09:58 AM
#14
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From: Engines Turn or People Swim
Also, my guess is that mag doesn't have a good case against DAL and they know it. Time will tell on that one...
01-07-2010 | 10:29 AM
#16
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From: CRJ FO
Can ANYONE realistically think that Mesa will come out of chp 11 bk? They are hit with bad press, very upset labor, at least two majors wanting to drop and have lawsuits against them, and have little to no money and credit with massive debt. Plus what part of labor would accept large pay cuts to help in any way where they won't see any benifit from where as if Mesa fails there could be better opportunities, thou many would have to start over on a seniority list. In my opinion this bk is nothing like a delta/nw chp 11 or ual. How could Mesa come out stronger? I'm sure every regional is calling to inquiry usairways about "helping out" and future goals if they cut ties with Mesa
01-07-2010 | 11:26 AM
#18
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In the first three quarters of the fiscal year we took strides to grow our fuel efficient CRJ-900 fleet flying for Delta as Freedom Airlines. We placed seven 900's into service in the first three quarters with the intent to fulfill a contract with Delta to increase the CRJ-900 fleet to a total of 14 aircraft. In August 2008, Delta notified Mesa of the termination of the CRJ-900 Delta Connection Agreement, citing an alleged failure to meet certain contractual benchmarks contained in the CRJ-900 Delta Connection Agreement. Mesa denies having violated the Delta Connection Agreement and we intend to challenge Delta's decision.
01-07-2010 | 11:26 AM
#19
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From: Xbox 360 - Reclined
Is the MESA MEC working on getting their pilots preferential hiring at their ALPA brother carriers?
It would be a shame to see flight instructors, and corporate wannabes getting hired into a 121 op before furloughs.
It would be a shame to see flight instructors, and corporate wannabes getting hired into a 121 op before furloughs.
01-07-2010 | 11:53 AM
#20
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Why would they? No other airline who has furloughed is getting their pilots preferential hiring at other ALPA brother carriers. Why should a Mesa guy be in front of a Horizon, PSA, Piedmont, Air Wisconsin, Alaska, United, US Airways etc.... pilot?
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