ATA Airlines begins court battle for survival

Airline Industry Information, Nov 12, 2004

AIRLINE INDUSTRY INFORMATION-(C)1997-2004 M2 COMMUNICATIONS LTD

ATA Airlines has begun its court battle to gain permission from a bankruptcy judge to sell off or scale down the company following its Chapter 11 protection filing in October 2004.

Central to ATA's case is permission to sell its most valuable asset other than aircraft, the 17 gates it holds at airports in Chicago, New York and Washington. The airline appears to have sealed a deal with low-cost carrier AirTran Airways to sell the gates for USD87.5m but must gain the court's permission before closing the deal.

A deadline will also be set for bids for the airline or part of it, with America West Airlines likely to make a bid before the end of November 2004. ATA chairman J. George Mikelsons said that the airline wants to have cut its fleet by a third at the end of 2005 and is aiming to fly a fleet of 50 aircraft including new smaller regional jets, reports IndyStar.com.

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