US Airways Group to buy back $115.8 million ATSB replacement warrants

By Caroline Salls

Pittsburgh, Oct. 3 - US Airways Group, Inc. has agreed to repurchase all 7.7 million or $115.8 million of the replacement warrants recently issued to the Air Transportation Stabilization Board in connection with the recently completed merger with America West Holdings Corp., according to a company news release.

The company will buy the shares back at an exercise price of $7.27 per share.

"The merger between America West and US Airways has been supported by more than $800 million in new equity investments and we expect to have approximately $2.5 billion in total cash when certain transactions close this week," president and chief executive officer Doug Parker said in the release.

"We have elected to use a portion of these cash balances to purchase the outstanding warrants held by the ATSB, which we believe is in the best interests of the shareholders of the new US Airways."

The warrants were created in conjunction with America West's $439 million ATSB loan in 2002, Parker said in the release.

The ATSB will also receive an additional $116 million for the warrants.

US Airways, previously an Arlington, Va.-based airline, emerged from Chapter 11 bankruptcy and completed its merger with America West on Sept. 27. Its Chapter 11 case number was 04-13819.

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