Tag: deadline (Page 1 of 2)

Avianca Files for Bankruptcy Protection

May 11, 2020 / WIL BALDWIN

(Reuters) – Avianca Holdings, Latin America’s second-largest airline, filed for bankruptcy on Sunday, after failing to meet a bond payment deadline, while its pleas for coronavirus aid from Colombia’s government have so far been unsuccessful.

If it fails to come out of bankruptcy, Bogota-based Avianca would be one of the first major carriers worldwide to go under as a result of the pandemic, which has crippled world travel.

Avianca has not flown a regularly scheduled passenger flight since late March and most of its 20,000 employees have gone without pay through the crisis.

“Avianca is facing the most challenging crisis in our 100-year history,” Avianca Chief Executive Anko van der Werff said in a news release.

While Avianca was already weak before the coronavirus outbreak, its bankruptcy filing highlights the challenges for airlines that cannot count on state rescues or on such rescues coming fast enough. Avianca is still hoping for a government bailout.

“This isn’t a surprise at all,” said Juan David Ballen, chief economist at Casa de Bolsa brokerage in Bogota. “The company was heavily indebted despite the fact it tried to restructure its debt last year.”

Avianca, the second-oldest continually operating airline in the world after KLM, had $7.3 billion in debts in 2019. The airline filed for Chapter 11 bankruptcy in New York and said it would continue operations while it restructured its debts.

The Colombian Association of Civil Aviators (ACDAC), a union representing many Avianca employees, said it supported the move.

Avianca already went through bankruptcy in the early 2000s, from which it was rescued by a Bolivian-born oil businessman, German Efromovich.

Efromovich grew Avianca aggressively but also saddled the carrier with significant debt until he was ousted from the airline last year in a boardroom coup led by United Airlines Holdings Inc. He still owns a majority stake in the carrier.

United stands to lose up to $700 million in loans related to Avianca.

Efromovich told Reuters on Sunday that he disagreed with the decision to file for bankruptcy and that he was not involved in making it.

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https://finance.yahoo.com/news/colombias-avianca-airline-files-bankruptcy-174035790.html

The logo of Avianca Airlines is pictured at a counter following the cancellation of an Avianca flight to San Salvador due to coronavirus fears in Mexico City

India Renews Plan to Sell Off Air India

January 27, 2020 / WIL BALDWIN

The Indian government is in the market to sell its stake of Air India – and on Monday set a March 17 deadline for initial expressions of interest.

Indian conglomerate Hinduja Group and US-based fund Interups are already reported to be submitting theirs.

It’s not the first attempt at a sale: in 2018 the government failed to divest 76 per cent of the airline, and with it over five billion dollars of debt.

Air India workers protested ….

And potential bidders opted out because of stringent conditions attached – such as retaining all employees.

This time, the government has indicated, it’s open to revising some provisions.

Though bidders must assume liabilities, including debt at just under 3.3 billion dollars.

And substantial ownership and control must remain with an Indian entity.

The sale might face opposition from within prime minister Narendra Modi’s ruling BJP Party – one lawmaker describes the deal as quote ‘anti-national’.

But if successful, the buyer gets over 7,000 landing slots in India and overseas …

Together with the carrier’s low-cost arm and a stake in its cargo and ground-handling operations.

As for staff, Air India currently has around 13,000 permanent and contract personnel on its books …

Including 1,850 pilots.

Boeing Out of Minuteman Missile Replacement Competition

December 14, 2019 / WIL BALDWIN

The Boeing logo is displayed on a screen, at the NYSE in New York

WASHINGTON (Reuters) – Boeing Co <BA> has decided not to compete as a prime contractor to replace the Pentagon’s aging U.S.-based Minuteman III missile system, paving the way for Northrop Grumman Corp <NOC> to win a contract worth tens of billions of dollars.

Friday marked the deadline to submit proposals to continue work on the replacement of the nearly half-century-old intercontinental ballistic missile (ICBM) system as the military embarks on a costly modernization of its aging atomic weapons.

Boeing said in a statement that it was disappointed it was unable to submit a bid. Northrop said it had submitted its proposal. No other bidders were expected.

Boeing’s decision not to enter a bid as a prime contractor had been foreshadowed this summer in a letter from the chief executive of Boeing Defense Space and Security, Leanne Caret, to Air Force leadership, saying Northrop’s 2018 purchase of solid rocket motor maker Orbital ATK might make it difficult for Boeing to compete on cost.

Orbital is the top producer of the solid fuel rocket motors generally used in Minuteman III and similar missiles.

Upgrading the U.S. nuclear force was expected to cost more than $350 billion over the next decade as the United States works to replace its bombs, nuclear bombers, missiles and submarines. Some analysts estimated the cost of modernization at $1 trillion over 30 years.

The Pentagon’s Cost Assessment and Program Evaluation office has said the total cost to replace Minuteman III could top U.S. $85 billion.

In 2017, the Air Force awarded https://www.reuters.com/article/us-boeing-pentagon-gbsd/u-s-air-force-awards-contracts-to-boeing-northrop-for-icbm-replacement-idUSKCN1B12H3 Boeing and Northrop Grumman separate contracts for the early engineering phase of the program.

(Reporting by Mike Stone; editing by Jonathan Oatis, Rosalba O’Brien and Richard Chang)

IndiGo Must Step Up Efforts to Replace Aircraft with Problem Pratt & Whitney Engines

November 25, 2019 / WIL BALDWIN

The logo of IndiGo Airlines is pictured on passenger aircraft on the tarmac in Colomiers near Toulouse

NEW DELHI (Reuters) – India’s air safety watchdog said IndiGo must do more to fix its aircraft fitted with Pratt & Whitney engines, linked to in-flight shutdowns, as it fears the budget airline may not meet its Jan. 31 deadline to replace them.

Deliveries of new planes taken by IndiGo must be used to replace the aircraft that are fitted with the problem Pratt engines, the Directorate General of Civil Aviation (DGCA) said on Monday. Those planes should then be grounded until their engines are replaced with new ones, after which they can fly again.

Indigo is the biggest customer of Airbus A320neo jets.

The regulator’s move effectively prevents India’s top airline from expanding its network until it has replaced all the Pratt & Whitney engines.

United Technologies’ Pratt & Whitney engines have consistently caused issues since they entered into service in 2016, forcing IndiGo to ground its planes several times.

In a recent review meeting with the airline, the DGCA felt that the steps taken by IndiGo so far to replace all the engines “do not instil enough confidence with regard to the timely completion of the said task”.

“If left unaddressed, we may find ourselves in a situation, in which, we remain saddled with large number of aircraft with unmodified engines … and we are left with the only option i.e. to ground them,” the regulator said in the statement.

On Nov. 1 the regulator had ordered the airline to replace all P&W engines on its fleet of almost 100 twin-engined Airbus A320neo family aircraft with new power units by Jan. 31, 2020.

If the replacement is not complete, all planes that still have unmodified engines will be grounded and could cause “large scale disruptions” in operations. The latest directive is aimed at preventing such a situation, the DGCA said.

IndiGo, owned by InterGlobe Aviation, said the current schedule remains intact, and it is working with P&W and Airbus to meet the DGCA guidelines.

(Reporting by Aditi Shah, editing by Louise Heavens)

Italian Airline Alitalia’s Rescue in Doubt as Atlantia Backtracks

November 19, 2019 / WIL BALDWIN

MILAN, Nov 19 (Reuters) – Italian infrastructure group Atlantia said on Tuesday it was not ready to join a consortium led by Italian railway group Ferrovie dello Stato to rescue loss-making carrier Alitalia, casting a shadow on the entire project.

After months of negotiations and with just one day left before a deadline expires, the group controlled by the Benetton family said that the conditions did not exist yet for it to join a consortium working on Alitalia.

Atlantia added, however, it remained available to engage in negotiations to seek for an industrial partner for the carrier.

A deadline to present a binding offer for Alitalia expires on Thursday, after being postponed several times.

Loss-making Alitalia has been run by special administrators since May 2017 and talks led by Ferrovie have been going on for a year without a deal.

The carrier, which is burning through its cash reserves, is expected to finish its money at the end of this year.

Ferrovie and Atlantia have been in talks with both U.S. carrier Delta Air Lines Inc and, recently, with German airline Lufthansa.

Delta said it was ready to invest 100 million euros ($111 million) in the Italian carrier but sources had said it did not agree with Ferrovie and Atlantia over the development of the Italian carrier’s long-haul business.

On the other hand, Lufthansa said it was prepared to set up a commercial partnership with the Italian carrier but did not want to take a stake in the group before it has gone through a complete restructuring.

“We will not invest in current Alitalia, but we are interested being a commercial partner,” said Lufthansa CEO Carsten Spohr at an event in Berlin on Tuesday.

Italian daily La Repubblica on Tuesday said the airline could be nationalized for some years before being sold.

Analysts calculate that Italian taxpayers have spent more than 9 billion euros to support Alitalia, which has undergone two previous failed rescue attempts.

($1 = 0.9028 euros)

(Reporting by Francesca Landini; Additional reporting by Ilona Wissenbach in Berlin; Editing by Lisa Shumaker)

Delta Might Pull Out of Alitalia Bid Consortium

November 3, 2019 / WIL BALDWIN

MILAN (Reuters) – Delta Air Lines <DAL> could pull out of a consortium looking to rescue Italy’s Alitalia as it is unwilling to enter a possible bidding war with Lufthansa <DLAKY>, newspaper Il Corriere della Sera reported on Sunday, citing two sources.

Delta is expected to say it will not raise its offer to invest about 100 million euros ($112 million) in Alitalia in a letter to be sent in the middle of this week to its consortium partners, Italy’s state railways firm Ferrovie and infrastructure group Atlantia, Il Corriere reported.

It said the rough investment figure could go as high as 120 million euros.

But Germany’s Lufthansa might invest about 150 million euros, Il Corriere said.

Lufthansa is seeking up to 6,000 job cuts, however, versus 2,500 envisaged by a plan drafted by the Delta consortium, the newspaper reported.

A source said last week Lufthansa was ready to invest up to 200 million euros in Alitalia which is running out of cash and scrambling to find new funds.

Italy’s industry ministry has extended to Nov. 21 a deadline for binding bids after an Oct. 15 deadline passed without an agreement among potential rescuers.

Alitalia’s temporary administrators said last month that the company’s liquidity amounted to 310 million euros at the end of September.

But that figure was inflated by advanced payments on pre-paid tickets, Sunday’s Il Sole 24Ore newspaper reported, citing unidentified sources.

The report added that adjusted for future costs, the cash amounted to just 160 million euros, and that it would run out in December.

($1 = 0.8957 euros)

(Reporting by Giulio Piovaccari; editing by Jason Neely)

Union Pacific Reports Positive Train Control Progress

November 3, 2019 / WIL BALDWIN

Union Pacific 4014 “Big Boy” steam locomotive visits Tucson, Arizona on October 18,2019

Union Pacific implemented Positive Train Control (PTC) on 1,113 route miles in the third quarter of 2019, bringing required PTC-operated route miles to 15,791 or 93 percent, including all required passenger train routes. Nearly all Union Pacific trains operating on PTC-mandated rail lines are operating with PTC locomotives. The company expects to have implemented PTC on all required lines by end of 2019, a year before the Congressional deadline. Its interoperability efforts with other railroads will continue through 2020.

Union Pacific currently hosts 31 freight and passenger railroads, which must achieve PTC interoperability by December 2020. Eleven of these railroads are already compliant, encompassing 85% of Union Pacific’s interoperable PTC train miles. While Union Pacific’s infrastructure is PTC-ready, it is working to be PTC-interoperable with the remaining partner railroads. The company’s expectation is that they will take necessary steps to reach interoperability on our network by mid-2020.

One of the most challenging parts of PTC implementation is ensuring system interoperability among all U.S. rail lines and locomotives. Given the various readiness levels of North American freight and passenger railroads, including publicly funded commuter lines and short lines, it is important that all railroads continue working together to maintain the health, safety, resiliency, and fluidity of the rail network during PTC implementation.

Union Pacific completed PTC installation on required route miles and employee training. PTC education is ongoing as Union Pacific retrains employees and introduces the system to new employees. Training materials are tailored to a variety of employee roles, including engineer, conductor, dispatcher, maintenance of way/engineering, mechanical, signal, telecom and information technologies.

With the FRA’s conditional approval of Union Pacific’s PTC safety plan on April 26, 2017, Union Pacific is running PTC operations on more than 15,000 miles in Arizona, Arkansas, California, Colorado, Idaho, Illinois, Iowa, Kansas, Louisiana, Minnesota, Missouri, Nebraska, Nevada, New Mexico, Oklahoma, Oregon, Tennessee, Texas, Utah, Washington, Wisconsin and Wyoming. Union Pacific and freight and passenger railroads continue working together to safely implement PTC on the remaining 1,271 required route miles.

Alitalia Set for Temporary Reprieve as Rescue Deadline Nears

October 14, 2019 / WIL BALDWIN

MILAN, Oct 14 (Reuters) – Alitalia is set to win a temporary lifeline on Tuesday, when its latest rescue deadline expires, with toll road operator Atlantia expected to give a conditional green light to hundreds of millions of euros of investment, according to two people close to the situation.

The future of the troubled Italian carrier remains in doubt with no binding offer and no clear business plan in sight but it should avoid an immediate liquidation after the expiry of the Oct. 15 deadline set by the industry ministry.

Atlantia, which is controlled by Benetton family, has been in talks since July over taking part in a government-orchestrated rescue of the airline, together with railway group Ferrovie dello Stato, the treasury and Delta Air Lines.

“Atlantia is expected to give its commitment to invest in Alitalia subject to several conditions,” one of the sources said. But issues that still cause concern range from potential antitrust problems, treatment of state aid under European Union rules, the cost of possible redundancies and the future of the carrier’s long-haul routes, the source said.

Oct. 15 is the latest in a series of deadlines set for Ferrovie and potential partners in a rescue for Alitalia, which has been under special administrators since May 2017 and needs new funds to continue flying.

The board of Atlantia, which runs Rome’s airports through its Aeroporti di Roma unit, is expected to approve a preliminary commitment to the Alitalia rescue on Tuesday, the sources said.

The rescue plans include potential investment of a total of around 1 billion euros in the carrier, which has cut costs under the special administrators but still burns cash and had only 310 million euros left at the end of September.

Atlantia is expected to invest some 300 million euros, depending on commitments from other partners.

A second source said more time was needed to iron out a complete business plan for Alitalia. Possible involvement by Delta Air Lines or Germany’s Lufthansa AG is still under discussion.

A third source said Atlantia, Ferrovie and other potential partners were under pressure from Italy’s Industry Ministry to present a binding bid and take control of the carrier which in the past two years has already received 900 million euros from the state to stay afloat.

Atlantia’s participation in the rescue was put in doubt this month when it wrote to the Industry ministry, urging a radical overhaul of the Alitalia plan if talks were to go ahead.

(Reporting by Francesca Landini, Stefano Bernabei, Giuseppe Fonte. Editing by Jane Merriman)

An Alitalia Airbus A320 takes off on September 26, 2017 from Toulouse-Blagnac airport in southwestern France. / AFP PHOTO / PASCAL PAVANI

Avianca Exchanges $475 mln in Bonds, Gets United Funding

September 12, 2019 / WIL BALDWIN

BOGOTA, Sept 12 (Reuters) – Latin American airline Avianca announced the exchange of $475.2 million in bonds on Thursday, part of a plan to change its capital structure amid ongoing financial problems and enough to receive additional financing from United Airlines.

In a statement to Colombia’s financial regulator, Avianca said it would extend the deadline for bond holders to exchange their paper until Sept. 25, in a bid to exchange a total of $550 million worth of bonds coming due next year.

Investors can exchange the bonds for others also coming due in 2020, but with a $50 bonus per $1,000.

United Airlines and Kingsland Holdings Limited, which between them control Avianca, said in a joint statement that results of the exchange thus far were sufficient for it to give the airline up to $250 million in additional financing.

“We are also pleased to confirm that this achievement is sufficient to satisfy United’s requirement for the exchange of these May 2020 bonds, regarding our previously announced offer, together with Kingsland, to loan $250 million to Avianca Holdings,” said John Gebo, senior vice president of alliances for United Airlines.

“Our loan remains contingent on certain other conditions being met by Avianca Holdings, including certain commitments and waivers made by other stakeholders,” Gebo said.

United launched a management overhaul at Avianca in May, removing top shareholder German Efromovich from controlling the cash-strapped airline.

(Reporting by Nelson Bocanegra Writing by Julia Symmes Cobb; Editing by Tom Brown)

Alitalia Rescuers to Ask for Another Delay

September 5, 2019 / WIL BALDWIN

MILAN, Sept 5 (Reuters) – Companies hoping to rescue Italian carrier Alitalia will ask for a deadline for presenting their plan to be extended as they are still negotiating key aspects, two sources familiar with the matter said.

Italian railway group Ferrovie dello Stato, which is leading an effort to take control of Alitalia, is expected to ask administrators running the carrier for a “substantial” delay to the Sept. 15 deadline, one of the sources said.

It would be the sixth delay since Ferrovie expressed its interest in investing in the carrier at the end of last year.

Ferrovie, infrastructure group Atlantia and U.S. carrier Delta Air Lines have been discussing a joint plan for Alitalia for nearly two months, but they are at odds over highly-profitable North American routes, three sources familiar with the matter said.

The Italian partners in the consortium want Alitalia to have more freedom to expand its North American routes compared to what Delta is currently offering under a new cooperation agreement dubbed Blue Skies that it has set up with Air France KLM and Britain’s Virgin Atlantic.

How Alitalia would share the revenue coming from North American routes with Delta and other partners in the Blue Skies alliance is also under negotiation.

“The role of Alitalia in the Blue Skies alliance is a point of contention,” one of the sources said.

Long-haul flights to the United States and Canada account for more than one third of Alitalia’s revenue and are considered key to reviving the Italian carrier, which was put under special administration in 2017 after workers rejected the latest in a long line of rescue plans.

Administrators appointed by Italy’s government have cut costs and renegotiated plane leasing contracts to make Alitalia more efficient, but the carrier still burns cash and had been kept afloat thanks to a 900 million-euro bridging loan granted by Italy’s treasury.

Alitalia had only 410 million euro left in its coffers in July and would need fresh funds by the end of the year when it is expected to post a loss, according to another source.

Delta and Ferrovie declined to comment. (Additional reporting by Tracy Rucinski in Chicago Editing by Alexandra Hudson)

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