US Airways completes sale of regional jet and slot assets

By Caroline Salls

Pittsburgh, Sept. 22 - US Airways Group Inc. completed the sale of Embraer regional jet aircraft and slot assets to Republic Airways Holdings, generating about $90 million in liquidity for US Airways as it completes its Chapter 11 restructuring and merger with America West Airlines, according to a company news release.

The regional jets and the slots will continue to operate as US Airways Express.

Under the terms of the asset sale agreement, Republic will purchase or assume the leases of 25 Embraer 170 aircraft from US Airways and will operate them in the US Airways network under a regional jet service agreement that was approved by the U.S. Bankruptcy Court for the Eastern District of Illinois.

Republic purchased three additional Embraer 170s that had been slated for delivery to US Airways directly from the manufacturer.

In addition, US Airways sold and then leased back from Republic commuter slots at Ronald Reagan Washington National and New York LaGuardia airports.

Other Embraer 170 assets, including a flight simulator and spare parts needed to support the aircraft operations, also are planned to be part of the transaction, the release said.

These purchases are expected to be completed in the next few weeks.

The Republic asset sale transaction represents about $100 million in cash that is built into US Airways' plan of reorganization.

US Airways, an Arlington, Va.-based airline, filed for bankruptcy on Sept. 12, 2004. Its Chapter 11 case number is 04-13819.

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