United Air Lines gets $3 billion exit financing commitment, expects to finalize terms soon

New York, Aug. 25 - UAL Corp. said it has a commitment for $3 billion of exit financing and expects to finalize the terms "in the near future."

The lenders are the same four that submitted preliminary proposals earlier in the year, the Chicago-based parent of United Air Lines said in a filing Thursday with the U.S. Bankruptcy Court for the Northern District of Illinois.

United said the commitment was fully underwritten and has "competitive terms and conditions" - although it added that it is working with the lenders and the official committee of unsecured creditors to obtain further improvements.

United also noted that the size of the financing is more than the $2.5 billion it had asked for.

The facility would give the airline capacity to refinance the 14 plans from the 1997-1 EETC transaction if United buys the class A certificates. It recently renegotiated its debtor-in-possession facility to allow it to do that.

Resolving that transaction means all section 1110 issues have been dealt with through executed term sheets, leaving just the exit financing and filing and confirmation of the plan of reorganization before the company can leave Chapter 11. It expects to emerge in late 2005 or early 2006.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.