Sunday, 1 July 2012

American Airlines asks for more time

The parent company of American Airlines may get more time to present a turnaround plan in federal bankruptcy court. AMR Corp. said Friday that a committee of unsecured creditors agreed to support a three-month extension for AMR’s exclusive right to offer a restructuring plan. 

 An extension could give American the time it needs to complete cost-cutting agreements with labor unions and might help it fend off a takeover bid by US Airways. The exclusive period has already been extended once and was due to expire Sept. 28, but American will ask for a new deadline of Dec. 27. A federal judge is expected to rule on the request next week. New long-term labor contracts are a key piece of AMR’s plan to reduce costs and emerge from bankruptcy protection as a profitable, independent company. 

 After years of little progress, American has recently struck agreements covering about 10,000 workers and is talking with others. Pilots will finish voting Aug. 8 on a contract offer, and American will resume negotiations Monday with unions for flight attendants and mechanics. 

AMR spokeswoman Missy Cousino said that the company’s turnaround plan is gaining momentum and that creditors were “expressing confidence in what we’ve accomplished” by agreeing to extend AMR’s restructuring rights. An extension could delay a chance for other bidders to present offers for AMR in bankruptcy court until next year. US Airways Group Inc. has lined up support from American’s unions for a potential bid. US Airways declined to comment Friday.

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