| Add to balance / Manage account | User: | Log out |
| Prospect News home > News index > List of issuers U > Headlines for US Airways Group, Inc. > News item |
S&P cuts US Airways ratings
Standard & Poor's said it lowered its ratings on US Airways Group Inc. and its US Airways Inc. subsidiary due to an increasing risk that crucial labor negotiations will not be completed successfully by Sept. 30, after which the airline could be in default under its federally guaranteed loan, financing arrangements for regional jet deliveries could be withdrawn, and added cash collateral would be required by a credit card processor.
In addition, the company faces pension payments of $133 million during the second half of 2004, a substantial portion of which is due Sept. 15. According to media reports, US Airways Group's chairman, David Bronner, said on Aug. 18 that the airline's unions must agree to wage concessions by mid-September or the company would face bankruptcy and could well be liquidated.
Ratings on senior classes of enhanced equipment trust certificates, which are either bond insured or well collateralized, were not lowered. The outlook is negative.
S&P said ratings on US Airways reflect a significant near-term risk of bankruptcy, a weak financial profile, mounting pressure from low-cost competitors, and the challenge of rapidly lowering the airline's operating costs in response to these threats.
Ratings lowered include US Airways Group Inc.'s corporate credit rating to CCC from CCC+ and US Airways Inc.'s corporate credit rating to CCC from CCC+ and equipment trust certificates to B from B-. Also lowered were US Airways Inc.'s pass-through certificates series 1998-1B to B from B+, series 1998-1C to CCC from CCC+, series 1999-1B to B from B+, series 1999-1C to CCC from CCC+, series 2000-3C to CCC+ from B-, and series 2001-1C to CCC+ from B-.
© 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.