US Airways receives federal loan guarantee following emergence from bankruptcy protection

Airline Industry Information, April 1, 2003

AIRLINE INDUSTRY INFORMATION-(C)1997-2003 M2 COMMUNICATIONS LTD

US Airways successfully emerged from Chapter 11 bankruptcy protection yesterday (31 March).

Following the emergence, the Air Transportation Stabilisation Board (ATSB) has issued the airline with a USD900m federal loan guarantee. The guarantee is for a private loan package of USD1bn. The carrier will also receive USD240m from the Retirement Systems of Alabama in return for a 37% stake in the airline.

US Airways, which filed for bankruptcy in August 2002, now has 36% fewer employees, 30% fewer available seats and 25% fewer flights, as well as a reduction in annual costs of USD1.9bn.

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