Continental Airlines Drops Appeal

Old Feb 23, 01, 10:39 am
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Join Date: Oct 2000
Location: Alexandria, VA, USA
Posts: 140
Continental Airlines Drops Appeal

This is looking more and more a done deal!

Passed on information from AIRWISE:

Feb 23, 2001

Twenty-four hours after a federal judge ruled against them Continental Airlines dropped an appeal of the bidding process for Trans World Airlines.

The airline said it was now satisfied with assurances given by American Airlines regarding its USD$500 million offer for bankrupt TWA.

Continental's effective withdrawal came a day after a judge in Delaware rejected the company's request for a stay in the bankruptcy proceedings while it appealed the bidding process and USD$200 million of debtor-in-possession financing American provided to TWA.

Houston-based Continental said that it decided to end the process once American "unconditionally guaranteed that it would fulfill its promises to hire substantially all of the TWA employees and protect retiree benefts."

American has proposed paying USD$500 million for most of TWA's assets, including up to 190 planes and the St. Louis hub.

It also would pay USD$82 million for a 49 per cent stake in DC Air, which would serve 44 destinations out of Washington's Reagan National Airport.

At Wednesday's hearing before the bankruptcy court TWA and American gave assurances, including one that the jobs of TWA's employees would be saved and the benefits of TWA's existing retirees protected.

The deadline for TWA bids is February 28. A sale date has been set by the court for March 9, but the only firm interest so far is from American.

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