<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by Plato90s:
Multiple telecoms worth billions at their peak are now in bankruptcy and facing liquidation.
If it can happen to telecom, it can happen to UA.
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Careful not to confuse market cap with worth -- they have nothing to do with each other.
Now, when you ARE talking market cap, you are referring to public companies -- please don't think for a moment that there is any VC component left in the capital structure of these public telecoms -- the IPO is the exit strategy for the VC -- that is their business.
<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by Plato90s:
While I agree DIP financing is generally safe, it first requires that the existing creditors of UA agree to DIP. Bank One may become the lead investor for DIP financing, but the plan must first pass muster with other creditors holding UA debt.
If the other creditors aren't satisfied, they can try to force UA into Ch. 7, regardless of what management and Bank One wants.
Once the creditors agree to restructuring, then the DIP lead investor is in firm control. UA isn't there yet, as far as I know.</font>
First of all, you are referring to creditors as one group -- this is an error. There are secured and unsecured creditors and their rights, as well as their agenda, are drastically different. Also, the statement that the creditors are involved in "agreeing" to the DIP facility is simply misinformed. In fact, unsecured creditors are seeing assets that might otherwise be used to satisfy them hypothecated to the DIP lenders.
I am really not trying to be difficult here, but I have done this for a living for 20 years.
In the end, it is still a crap shoot at this stage whether we are talking about Continental or PanAm here -- I have 2M miles that says I hope it is CO, but I did just book my in-laws and their kids to LAS in F using miles -- and I don't even like them
(the in-laws I mean - I LOVE the miles
)
[This message has been edited by B Watson (edited 12-12-2002).]