Friday, May 23, 2008
Mesa may seek bankruptcy if Delta terminates contract
NEW YORK (MarketWatch) -- Mesa Air Group Inc. may seek bankruptcy protection if Delta Air Lines is successful at terminating its connection agreement with the $14.7 million market-cap carrier. In a Securities and Exchange Commission filing on Thursday, the Phoenix-based carrier said it didn't think it could redeploy the 34 Embraer, 50-seat jets on under contract in a timely manner, losing about $960 million over the next four years in revenue while ringing up about $250 million to $300 million in costs. "As a result, the company's cash flows from operations and its available working capital would be insufficient to meet these cash requirements," Mesa said in the filing. Mesa shares shed 12.5% to 50 cents.
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