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US Airways gets $65 million commitment from Tudor Investment to fund plan equity
By Caroline Salls
Pittsburgh, July 7 - US Airways Group, Inc. and America West Group said Tudor Investment Corp. has made a $65 million commitment to provide equity funding for US Airways' plan of reorganization in exchange for 3.9 million shares of new common stock at a price of $16.50 per share, according to a company news release.
The funding will occur along with other equity investments upon completion of the merger of America West and US Airways.
The other equity partners funding the US Airways plan and merger with America West are ACE Aviation Holdings Inc., a Canadian holding company that owns Air Canada ($75 million commitment); PAR Investment Partners, LP, a Boston-based investment firm ($100 million commitment); Peninsula Investment Partners, LP, a Virginia-based investment firm ($50 million commitment) and Eastshore Holdings LLC, which is owned by Air Wisconsin Airlines Corp. and its shareholders ($125 million commitment and agreement to provide regional airline services).
A rights offering under the merger agreement could provide an additional $150 million of equity financing.
As previously announced, the merger will be funded by $565 million in new equity investment and participation by suppliers and business partners that will provide the company with $1.5 billion in liquidity.
The merger is expected to close in the early fall. The airline will operate under the US Airways brand and will be based in Tempe, Ariz.
US Airways, an Arlington, Va.-based carrier, filed for bankruptcy on Sept. 12, 2004 with the U.S. Bankruptcy Court for the Eastern District of Virginia. Its Chapter 11 case number is 04-13819.
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