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AA - US Merger Agreement / Announcement / DOJ Action Discussion (consolidated)

View Poll Results: My opinion of the announced AA - US merger is:
This is the best of all possible worlds; great idea!
33
3.93%
This portends a stronger airline, with some changes for all
192
22.88%
I am neutral - pros and cons for all
199
23.72%
I think this is a somewhat bad idea with some real challenges
226
26.94%
I am completely opposed to this merger; terrible idea!
189
22.53%
Voters: 839. You may not vote on this poll

AA - US Merger Agreement / Announcement / DOJ Action Discussion (consolidated)

 
Old Feb 13, 13, 5:59 pm
  #61  
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UCC has approved

UCC has approved the deal.

AMR's unsecured creditors are expected to be made whole under the terms and also get accrued interest, while AMR's shareholders will get a small equity stake in the new entity, they added.
http://www.chicagotribune.com/busine...,3154967.story



If the unsecured creditors are made whole, then AA didn't trim enough.
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Old Feb 13, 13, 6:02 pm
  #62  
 
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Originally Posted by FWAAA View Post
UCC has approved the deal.



http://www.chicagotribune.com/busine...,3154967.story



If the unsecured creditors are made whole, then AA didn't trim enough.
Not necessarily. They primarily got equity in the combined company not big pay outs from AA. They will get issued stock so that really costs the new entity little.
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Old Feb 13, 13, 6:08 pm
  #63  
 
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Where are all of the <redacted> who insisted as of a few days ago that such information is probably inaccurate as NDAs are in place?


Originally Posted by FWAAA View Post
UCC has approved the deal.



http://www.chicagotribune.com/busine...,3154967.story



If the unsecured creditors are made whole, then AA didn't trim enough.

Last edited by JDiver; Feb 13, 13 at 8:00 pm Reason: http://www.flyertalk.com/help/rules.php#q87
morrisunc is offline  
Old Feb 13, 13, 6:11 pm
  #64  
 
Join Date: Jan 2013
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I am new to the miles programs and was wondering how this merger will effect my current miles. We have about 250k AA miles. Will this cause any negative issues?

Also once they merge will US Airway miles and AA miles merge as well? If I apply today for the us Airway miles will it then be merged with my AA miles?
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Old Feb 13, 13, 6:11 pm
  #65  
 
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Originally Posted by morrisunc View Post
Where are all of the <redacted> who insisted as of a few days ago that such information is probably inaccurate as NDAs are in place?
Those were folks in denial. Just like with the BK.. these kinda things always get leaked. Standard practice and the sources were too respected not to believe them, not some random postings on someone's webpage.

Last edited by JDiver; Feb 13, 13 at 7:59 pm Reason: deleted previously redacted term
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Old Feb 13, 13, 6:12 pm
  #66  
 
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Originally Posted by FWAAA View Post
UCC has approved the deal.



http://www.chicagotribune.com/busine...,3154967.story



If the unsecured creditors are made whole, then AA didn't trim enough.
And it appears that pre-BK equity holders will get a bit of new equity (IF MERGER IS APPROVED AS PART OF FORMAL REORG PLAN BY BK JUDGE/TRUSTEE). I knew there would be some equity left over for the old equity holders.
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Old Feb 13, 13, 6:14 pm
  #67  
 
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Originally Posted by george 3 View Post
And it appears that pre-BK equity holders will get a bit of new equity (IF MERGER IS APPROVED AS PART OF FORMAL REORG PLAN BY BK JUDGE/TRUSTEE). I knew there would be some equity left over for the old equity holders.
pennies on the dollar i'm sure.. "small stake" being the key words
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Old Feb 13, 13, 6:14 pm
  #68  
 
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So what happens to the LCC long term debt? Does it become a liability of the merged entity, paid off with stock of the new entity, ... ? Considering the makeup of the new board (American's creditors will appoint five directors, American will appoint three and US Airways four), a majority are looking to cash out now, are less concerned with such details moving forward - not a good sign.
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Old Feb 13, 13, 6:20 pm
  #69  
 
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Originally Posted by 787fan View Post
Isn't it ironic that one could use EVIP to ICN but not to HKG (major OW hub)
+1.
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Old Feb 13, 13, 6:20 pm
  #70  
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Originally Posted by sidar View Post
I am new to the miles programs and was wondering how this merger will effect my current miles. We have about 250k AA miles. Will this cause any negative issues?

Also once they merge will US Airway miles and AA miles merge as well? If I apply today for the us Airway miles will it then be merged with my AA miles?
You will not lose your miles. Eventually the two programs will be merged together. So if you have 100K AAdvantage miles and 100K DMs you will have 200K miles. Possibly more if there is somekind of bonus (RDMs).
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Old Feb 13, 13, 6:21 pm
  #71  
 
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Originally Posted by diver858 View Post
So what happens to the LCC long term debt? Does it become a liability of the merged entity, paid off with stock of the new entity, ... ? Considering the makeup of the new board (American's creditors will appoint five directors, American will appoint three and US Airways four), a majority are looking to cash out now, are less concerned with such details moving forward - not a good sign.
LCC debt only gets retired with new stock if the current LCC bondholders agree to accept it as a PIK (pay in-kind). Otherwise it gets consolidated into the new merged entity, subject to any credit approval rights embedded in the debt (anyone know of it from a 10-K or 8-K reading?) Is it senior to any debt created by pre-AA debt recast as new debt in a reorganized entity? Alot depends on the steps presented in the merger plan - does AA reorg with new equity issued to replace debt, renegotiated debt ratified, etc. occur first, then the merger?
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Old Feb 13, 13, 6:23 pm
  #72  
 
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Originally Posted by grahampros View Post
pennies on the dollar i'm sure.. "small stake" being the key words
I like "symbolic" better ...
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Old Feb 13, 13, 6:27 pm
  #73  
 
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Originally Posted by diver858 View Post
So what happens to the LCC long term debt? Does it become a liability of the merged entity, paid off with stock of the new entity, ... ? Considering the makeup of the new board (American's creditors will appoint five directors, American will appoint three and US Airways four), a majority are looking to cash out now, are less concerned with such details moving forward - not a good sign.
No indication this covers LCC's creditors. This is an agreement with the UCC debt holders of AA. US's debts are a fraction of AA's so that should not be a big deal and no doubt will be restructured with better rates and longer maturities. I expect that's all ready in progress. We will have to await the final details on the total remaining debt picture of the merged entity.
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Old Feb 13, 13, 6:33 pm
  #74  
 
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Originally Posted by grahampros View Post
No indication this covers LCC's creditors. This is an agreement with the UCC debt holders of AA. US's debts are a fraction of AA's so that should not be a big deal and no doubt will be restructured with better rates and longer maturities. I expect that's all ready in progress. We will have to await the final details on the total remaining debt picture of the merged entity.
Any of you M&A guys know if this is detailed in an 8-K or an S-1? The merged entity capital stack would be interesting as it gives clues to what the merged entity capitalization might look like in a couple of years in different scenarios - good merger, no benefits, heading sideways....
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Old Feb 13, 13, 6:37 pm
  #75  
 
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Originally Posted by grahampros View Post
No indication this covers LCC's creditors. This is an agreement with the UCC debt holders of AA. US's debts are a fraction of AA's so that should not be a big deal and no doubt will be restructured with better rates and longer maturities. I expect that's all ready in progress. We will have to await the final details on the total remaining debt picture of the merged entity.
A large fraction. North of $4 billion which is larger than the LCC equity in the new entity. I don't think you can call that not a big deal.
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