United: Aims to get $2B in financing ready just in case By Chris Woodyard, USA TODAY United Airlines is trying to line up $2 billion in financing to be ready in case it decides to file for bankruptcy-court protection, company officials said Thursday. The debtor-in-possession financing package is the latest in a series of moves that United is making to prepare for a Chapter 11 bankruptcy reorganization even as it hopes for federal loan guarantees that would avoid it. "It's important for our customers to know we are looking at all contingencies," says United spokesman Chris Brathwaite. "But first and foremost, we are trying to restructure outside of Chapter 11." CEO Glenn Tilton had already set a deadline of Dec. 2, when United has a $400 million loan payment due, to restructure the giant airline and obtain the loan guarantees. It was dealt a setback last week when the loan board made public a letter in which it outlined gaps in United's business plan. Brathwaite expressed confidence that the carrier's annual $1.1 billion reduction in labor costs and an expected $1.4 billion boost in revenue under its plan will lead to board approval of the guarantees. Observers say United is acting correctly by lining up post-bankruptcy financing. "I think it would be highly imprudent if they didn't do this," says airline consultant Morris Garfinkle. "This is just good business sense on their part to have a backup plan at worst and a front-line plan at best." Jon Schneider, a bankruptcy lawyer with the firm of Goodwin Procter in Boston, agrees. "No one would be thinking about bankruptcy without lining up (post-bankruptcy) financing," he says. United would continue flying, making it a good candidate for receiving the post-bankruptcy funds, he says. "There are certainly a bunch of valuable assets here." Sara Dela Cruz, a spokeswoman for United's flight attendants, says the union doesn't blame the airline for making bankruptcy preparations but that the focus should remain on obtaining the loan guarantees. The owner of Roger's Trinbago Site: Roj (Roger James) *************************************************** escape email mailto:ejames@escape.ca Trinbago site: http://www.tntisland.com CBC Website http://www.tntisland.com/caribbeanbrassconnection/ The Trinbago Site of the Week: (chgdev) http://www.chagdev.com/ (Chaguaramas Development Authority) courtesy of Roj Trinbago Website & TnT Web Directory Roj's Trinbago Website: http://www.tntisland.com TnT Web Directory: http://search.co.tt *********************************************************