PBGC complaint could delay United bankruptcy exit - report

Airline Industry Information, Oct 18, 2005

AIRLINE INDUSTRY INFORMATION-(C)1997-2005 M2 COMMUNICATIONS LTD

The emergence of United Airlines from Chapter 11 bankruptcy protection could be disrupted by an objection to its reorganisation.

Some experts say that an objection from the Pension Benefit Guaranty Corporation (PBGC) could hinder the bankruptcy exit, while others say that the objection is typical for a large bankruptcy and is not likely to delay matters. PBGC said last week that United's disclosure statement is in conflict with an agreement it has previously reached.

Anthony Sabino, airline expert and professor at St John's University, New York, has said that the airline is "playing with fire" as the current disclosure statement could be left without approval if the issue becomes a major one.

United has however said that it is willing to work with PBGC to address the objection, Reuters reported.

((Comments on this story may be sent to aii.feedback@m2.com))