Posted on: 21 January 2011 by Ross McSweeny
The US Bankruptcy Court for the Southern District of New York has approved Mesa Air Group’s Plan of Reorganization, clearing the way for the company’s emergence from Chapter 11 bankruptcy protection.
“This is an exciting day for everyone at Mesa,” declared Jonathan Ornstein, Mesa’s chairman and chief executive officer. “Achieving a turnaround of this magnitude in little more than 12 months would not have been possible without the hard work and dedication of Mesa’s employees and the focused execution of Mesa’s Plan of Reorganization by our management team led by Michael Lotz, president and chief financial officer and Brian Gillman, the executive vice-president and general counsel. I’d also like to thank Paul Foley, our chief operating officer, David Butler, our senior VP of human resources and Gary Appling, our senior VP of maintenance & engineering for their efforts on our underlying business during the restructuring.
Mesa is set to emerge from Chapter 11 as a carrier flying primarily larger 70- and 86-seat regional jet aircraft. Mesa’s creditors overwhelmingly supported the Plan of Reorganization, which also applies to the eleven wholly-owned subsidiaries of Mesa that filed for Chapter 11 protection. Mesa and each of its subsidiaries are expected to emerge from Chapter 11 in February 2011.
During the restructuring accomplishments, Mesa: extended the term of is codeshare agreement with US Airways until September 2015; eliminated more than 100 aircraft leases and financings; restructured aircraft leases and financings for its fleet of CRJ200 and Dash 8 aircraft resulting in flexibility and no long-term lease exposure on the CRJ200s. Mesa will now emerge as a private company and issue new notes, common stock, and warrants to its creditors.
“Mesa is now poised to enter its next chapter as a strong airline ready to compete in an ever-changing industry. We are particularly proud of the fact that during our restructuring, Mesa achieved – and has consistently maintained – regional airline leading operational performance as reported by the US Deptarment of Transportation, including Mesa achieving the highest monthly On Time Performance of all regional airlines since May 2010,” Ornstein added.
“This strong operational performance is a tribute to the hard work and dedication of all of our employees and came during a time when many of our employees contributed to our financial savings through the taking of additional unpaid days off. This level of dedication and associated strong operational performance has provided a strong foundation upon which to return our airline to sustained profitability and future growth,” concluded Ornstein.