Pan Am Gets A Lift From Guilford

Railway Age, June, 1998

Guilford Industries has offered to help pull Pan American World Airways out of bankruptcy. Pan Am says the New England regional rail operator has agreed to pay $23.5 million in cash for "certain of Pan Am's airline related assets"--including three Boeing aircraft--plus "all of Pan Am's route authorities and rights, Pan Am's 30% interest in the Pan Am air bridge, its U.S. regulatory certificates, and all trademarks, logos, and intellectual property relating to the Pan Am name." All of this is covered in a letter of agreement that Pan Am said would, if approved by the U.S. Bankruptcy Court, "form the foundation" of the air carrier's reorganization. A portion of the $23.5 million would go to Pan Am creditors. The reorganized company would start with $5 million of new working capital.

"Guilford's proposed investment in Pan Am will allow an American icon to remain aloft serving the traveling public, thus preserving jobs," said Pan Am President and CEO David A. Banmiller. With their solid record of success in the rail freight industry and significant access to capital, Pan Am will now be able to stabilize and then begin methodically to expand."